SHANGHAI, Apr. 2 (SMM) – Here are major reports for China’s lead market in the past week.
Proposed 5% Excise on Lead-Acid Batteries May Be Dropped
Wang Jinliang, Vice President of the China Battery Industry Association, revealed on March 23 during the 8th Shanghai Lead & Zinc Summit that a reduction or abandonment of the proposed excise tax on lead-acid batteries is under discussion, to the delight of producers.
Profit Growth for Battery Giants Slowed after Price War
Tianneng Power and Chaowei Power, leading battery producers in China, released 2012 annual reports last week. Although both companies saw increase in profits, the growth in profit margin slowed significantly, indicating the negative effects of capacity expansion and price war.
The net profits at Tianneng Power and Chaowei Power increased 87.20% and 127.10%, respectively in the first half last year, while their full-year growth slowed to 15.28% and 9% due to the price war in 4Q.
Large Enterprises Bearish to 2Q Lead Prices
SMM released the result of its survey concerning 2Q lead price outlook at the Shanghai Lead & Zinc Summit 2013, which indicated that most battery producers were bearish to lead prices in second quarter.
Metal Inventories Keep Rising to Hit New Highs
SHFE lead inventories kept increasing to 140,800 mt in and hit record high last week.
Environmental Protection Policy for Lead Industry Tightened
The Ministry of Industry & Information Technology and Ministry of Environmental Protection introduced several policies for regulation of lead-acid battery and secondary lead sectors. SMM believes environmental protection policy for lead industry will be tighter this year.
Disqualified Secondary Lead Capacities to Be Eliminated in 2013
Secondary lead capacities below 10,000 mt/yr, crucible smelting process, and coal-fired reverberator are required to be eliminated immediately, while secondary lead capacities below 30,000 mt/yr should be phased out by the end of this year.