Lead inventory to stay at three-year low on tight supply

SHANGHAI, May 11 (SMM) – SMM expects lead inventory to stay low in the short term on tight supply and high consumption from downstream battery plants in June.

China’s lead social inventory fell to the lowest level in three years this year. The stocks at Shanghai and Guangdong warehouses amounted to 16,000 mt in late April, down 70% from the same period in 2017 and down 78% from 2016.

As environmental inspection teams settled in Jiangxi province earlier this month, most small-sized secondary lead smelters were suspended with some certified ones being required to halve their output. This is expected to affect secondary lead output of over 1,000 mt per day on average.

Although some smelters resuming operations from maintenance may lead to an estimated 20,000 mt of primary lead production rebound in May, the growth will be partially offset by the secondary lead output drop.

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