Hot US inflation lifts Fed hike bets and the dollar; copper and aluminium slide, oil stays near two-month low
Base metals turned lower after US consumer prices rose faster than expected in October and markets moved to fully price a Fed rate hike in December, lifting the dollar. LME copper fell about 1.3% by the close and aluminium dropped about 2% to a three-week low, while nickel gave back about 2%. In India, copper scrap rates eased slightly and stainless steel scrap slipped about 1.5%, while aluminium scrap held steady. Brent crude stayed near its lowest level since August on hopes of easing tension with Iran.
Copper slips as the dollar firms and Chinese buyers hold back
LME copper fell about 1.3% by Tuesday's close and Shanghai copper lost about 1.3%, giving up Monday's bounce; the official cash price was down about 0.3%. Copper stocks in China remain very low, about 1,40,000 tonnes below a year ago in major regions, but high prices and premiums have cut buying, and some Chinese processors have reduced operating rates. Spot premiums in Shanghai fell sharply as more imported metal arrives. LME copper stocks stand at about 3,16,600 tonnes.
For your business: Bright and mixed copper scrap rates in India eased about 0.1% in the latest update and are about 1.7% lower than a week ago. With Chinese demand cooling, buyers may wait for dips before adding stock.
Aluminium falls to a three-week low
LME three-month aluminium fell about 2.3% on Tuesday to its lowest since 20 October and is now about 21% below its four-year high from June. Supply from the Middle East is returning faster than expected and new smelters are starting in Indonesia. China's exports of aluminium and products rose 18% to 5.9 million tonnes in January to October. LME stocks are still low, at about 2,26,900 tonnes, which keeps nearby metal tight.
For your business: Ingot-grade and utensil aluminium scrap rates in India were unchanged in the latest update. Softer global prices could limit any rise in local rates in the coming days.
Nickel gives back gains; zinc steady, tin near recent lows
LME nickel cash fell about 2% after a strong run last week on talk that Indonesia will cut its 2027 mining quota below this year's level. Zinc edged up about 0.4% but is down about 2.6% over the past week. Lead slipped about 0.4%, and tin was flat but remains about 14% below its late-September levels.
For your business: Stainless steel 304 scrap in India slipped about 1.5% and 202 about 0.8% as nickel fell. Zinc and lead scrap rates were unchanged in the latest update but are lower than a week ago.
US inflation surprise puts a December Fed hike on the table
US consumer prices rose 0.4% in October and core prices rose 0.3%, both a little above forecasts. Markets now fully expect a 0.25 percentage point Fed rate hike in December, the US 2-year yield rose about 0.13 percentage point and the dollar strengthened. Indian currency markets were shut on Tuesday for a holiday; the rupee last closed near ₹93.93 per dollar on Monday, after touching a six-month high before dollar buying by state-run banks halted its rally.
For your business: A stronger dollar usually weighs on LME prices. A steady rupee means Indian import costs move mostly in line with LME prices for now.
Brent holds near a two-month low but Hormuz attacks continue
Brent crude fell more than 3 dollars a barrel on Tuesday to its lowest since August after the US held off on new strikes against Iran, and was near $92 a barrel early on Wednesday. Attacks on ships near the Strait of Hormuz have not slowed, with tankers hit on Sunday and Tuesday. Even with a deal, a return to normal shipping would take time because of mines and high insurance costs.
For your business: Lower oil can ease fuel and power costs for recyclers. Freight and insurance for imported scrap on Gulf routes are likely to stay high.
Ferrous scrap flat in Delhi as steel demand stays slow
HMS 1 & 2, CR/HR coil and cast iron scrap rates were unchanged in Delhi in the latest update. A wider Indian ferrous scrap index has slipped in recent sessions on subdued steel demand. In China, factory-gate prices rose 5.7% in October from a year ago, the fastest in about four and a half years, while consumer prices rose only 0.7%.
For your business: Melting scrap sellers should expect slow, cautious buying after the festive period. A pick-up in construction demand would be the first sign of firmer rates.
What to watch next
- Fed comments ahead of the December meeting and the dollar's direction
- India's October retail inflation data on Thursday, 12 November
- Copper stocks and import premiums in China
- Indonesia's 2027 nickel mining quota
- US-Iran talks and ship attacks in the Strait of Hormuz
Prices now
LME prices are shown with a 2-day delay. Live LME and India rates are free for registered members.
This update is general market information, not investment or trading advice. Prices are indicative.
