China output of secondary lead in March

The output of secondary lead in March 2024 was 378,100 mt, an increase of 78.94% from February and an increase of 0.45% year-on-year. The total output of secondary lead from January to March 2024 was 908,500 mt, a decrease of 9.59% year-on-year. The output of secondary refined lead in March 2024 was 330,000 mt, an increase of 91.18% from February and an increase of 0.91% year-on-year. The total output of secondary refined lead from January to March 2024 was 774,300 mt, a year-on-year decrease of 11.32%.

According to SMM survey, the output of secondary refined lead has maintained a downward trend since November 2023, and has dropped by about 220,000 mt by February 2024, due mainly to high cost and low profit of secondary lead smelters. In mid-to-late February, lead prices fluctuated within a narrow range below 16,000 yuan/mt. This sidelined secondary lead smelters that had suspended production during the Chinese New Year holiday, and they delayed resumption of production to March. In March 2024,lead prices rose and at the end of the month, the most active SHFE 2405 lead contract rose to a three-month high; the price of battery scrap did not rise sharply. The price of electric vehicle battery scrap was slightly lowered during the month, and the recovery of profits of secondary lead smelters boosted the enthusiasm of production.

In April, the replacement volume of battery scrap will decline due to the traditional off-season for lead-acid batteries. Tighter raw materials for secondary lead smelters will increase procurement costs, narrowing profit margins or expanding losses. Several large-scale secondary lead smelters plan to suspend production for maintenance in late April, and some smelters plan to reduce production in April; however, as many large-scale smelters resumed production in mid-to-late March, the production ramp-up in April will still lead to an increase in secondary refined lead output. SMM expects secondary refined lead output to increase by 32,500 mt in April.