SMM Pb Survey: Average Operating Rate at Primary Lead Smelters Rises Steadily During April -Shanghai Metals Market

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SMM Pb Survey: Average Operating Rate at Primary Lead Smelters Rises Steadily During April

SMM Insight 05:23:05PM May 14, 2012 Source:SMM

SHANGHAI, May 14 (SMM) – An SMM survey of 43 domestic major primary lead smelters (total capacity: 4.045 million mt/yr) revealed the following insights:

1. Average Operating Rate at Primary Lead Smelters Rises Steadily During April

According to the SMM survey, the average operating rate at domestic major primary lead smelters during April was 64.42%, up 5.45% from March, and with refined lead output at the surveyed smelters reaching 214,200 mt, up 11,600 mt from a month ago.

The survey showed results varied by smelter size. Shadian Xingsha Nonferrous Metal Smelting and Mengzi Mining and Metallurgy, both of which reported low output during March due to maintenance and production suspensions, returned to normal operations and contributed heavily to growth in output for smaller smelters. As a result, the average operating rate at smelters with capacities below 50,000 mt/yr climbed to 63.60% during April, up 10.88% from March’s average.

Medium-scale smelters with capacities between 50,000-100,000 mt/yr also reported steady growth in output. Jiangxi Jinde Lead Stock, Inner Mongolia Xingan Silver and Lead Smelting, and Shaanxi Dongling Smelting, all resumed production in April having begun maintenance in March. Hechi Nanfang Nonferrous Metals also restarted production in the second half of March, so April’s average operating rate at these enterprises was up by 8.02% MoM, to 54.11%.

Output at larger smelters with capacities above 100,000 mt/yr remained stable, allowing operating rates to rise as well.

2. Yunnan’s Prolonged Drought Exerts Little Impact on Refined Lead Supply

SMM’s survey indicates that Yunnan’s prolonged drought, which started in 3Q last year, had little impact on the province’s overall output of refined lead in April, though drought-related water shortages did impede production at some local smelters.

Yunnan’s ongoing drought left local smelters with shortages impeding production in April, compelling some to turn to trucking in water to maintain production. Although there was no apparent impact on lead supply, the higher production costs incurred in transporting water combined with persistently low prices for refined lead shall squeeze margins.

The survey also confirmed the rain that started falling May 5, especially in southern Yunnan, brought a brief respite to the benefit of enterprises in the Gejiu and Honghe regions.
 

Key Words:  primary lead   operating rate 

SMM Pb Survey: Average Operating Rate at Primary Lead Smelters Rises Steadily During April

SMM Insight 05:23:05PM May 14, 2012 Source:SMM

SHANGHAI, May 14 (SMM) – An SMM survey of 43 domestic major primary lead smelters (total capacity: 4.045 million mt/yr) revealed the following insights:

1. Average Operating Rate at Primary Lead Smelters Rises Steadily During April

According to the SMM survey, the average operating rate at domestic major primary lead smelters during April was 64.42%, up 5.45% from March, and with refined lead output at the surveyed smelters reaching 214,200 mt, up 11,600 mt from a month ago.

The survey showed results varied by smelter size. Shadian Xingsha Nonferrous Metal Smelting and Mengzi Mining and Metallurgy, both of which reported low output during March due to maintenance and production suspensions, returned to normal operations and contributed heavily to growth in output for smaller smelters. As a result, the average operating rate at smelters with capacities below 50,000 mt/yr climbed to 63.60% during April, up 10.88% from March’s average.

Medium-scale smelters with capacities between 50,000-100,000 mt/yr also reported steady growth in output. Jiangxi Jinde Lead Stock, Inner Mongolia Xingan Silver and Lead Smelting, and Shaanxi Dongling Smelting, all resumed production in April having begun maintenance in March. Hechi Nanfang Nonferrous Metals also restarted production in the second half of March, so April’s average operating rate at these enterprises was up by 8.02% MoM, to 54.11%.

Output at larger smelters with capacities above 100,000 mt/yr remained stable, allowing operating rates to rise as well.

2. Yunnan’s Prolonged Drought Exerts Little Impact on Refined Lead Supply

SMM’s survey indicates that Yunnan’s prolonged drought, which started in 3Q last year, had little impact on the province’s overall output of refined lead in April, though drought-related water shortages did impede production at some local smelters.

Yunnan’s ongoing drought left local smelters with shortages impeding production in April, compelling some to turn to trucking in water to maintain production. Although there was no apparent impact on lead supply, the higher production costs incurred in transporting water combined with persistently low prices for refined lead shall squeeze margins.

The survey also confirmed the rain that started falling May 5, especially in southern Yunnan, brought a brief respite to the benefit of enterprises in the Gejiu and Honghe regions.
 

Key Words:  primary lead   operating rate