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SMM Pb Survey: Slight Declines in Operating Rates at 35 Chinese Lead Producers
May 10,2010 11:16CST
data analysis
Source:SMM

SHANGHAI, May 10 (SMM) - A recent SMM survey of 35 domestic lead producers (total capacity: 2.77 million mt/yr) revealed the following insights: 
 
1) Slight Declines in Operating Rates at Chinese Lead Producers

According to a SMM survey, the average operating rate at major domestic lead producers in April was 71.01%, slightly down from 74.64% in March.  During April, the number of domestic lead producers undergoing unit maintenance increased due to plant malfunctions.  These malfunctions, coupled with tight supply of raw materials and depressed domestic lead prices, resulted in the high number of producers conducting maintenance.  Maintenance at select producers will continue into May.  However, output from new capacity is expected to offset cuts in output from maintenance.  In this context, SMM believes China’s primary lead output will remain around 205 kt in April, flat at March levels. 

2) Any Downward Room Expected to Limited
Despite a pessimistic outlook for May LME lead prices, domestic lead producers generally believe any downward room for domestic lead prices to fall will be limited, with prices expected to remain above RMB 15,000/mt given current high production costs.

 

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