By-product boosts earnings for some enterprises; secondary refined lead spot order discounts expected to widen again [SMM Secondary Refined Lead Weekly Review]

SMM, September 4:

Lead prices consolidating at highs drove a continued recovery in secondary lead smelting losses. As of September 4, SMM large-scale secondary lead enterprises recorded a combined profit/loss of -101 yuan/mt, while small and medium-scale enterprises recorded -283 yuan/mt (excluding antimony and tin by-product revenues). A few enterprises with lower scrap battery procurement costs and the ability to recover antimony and tin achieved modest profits. This week, smelters showed strong willingness to hold prices firm, with some enterprises facing tight spot order supply. Mainstream transactions were at discounts of 75-25 yuan/mt against the SMM #1 lead average price; individual high-bismuth lead cargoes were sold ex-works at -175 yuan/mt, while a small volume of low-bismuth cargoes within the same industrial park were delivered at parity. Looking ahead to next week, the start of stockpiling for the two festivals, combined with improving antimony and tin market conditions, is expected to turn profits positive for large-scale enterprises. However, with secondary refined lead supply rebounding in September and the impact of imported refined lead, smelters will struggle to sustain firm prices, and spot order ex-works discounts are likely to widen.