SHANGHAI, Jun. 25 (SMM) – Here are major events in lead market during the past week.
Scrap Battery Supply Tightens, Secondary Lead Prices Remained Low
SMM data shows demand for replacement lead-acid batteries began slowing around the time of the Chinese Dragon Boat Festival. In addition, a growing number of scrap battery recyclers reduced operations due to the farming season in Anhui, Jiangsu, Hebei and Hubei province, which traditionally causes scrap battery traders to return home. However, secondary lead prices benefitted little from the current tight scrap battery supply.
SMM reported earlier that some large secondary lead smelters lowered procurement prices by RMB 150-200/mt in late April in order to stem losses. These cuts lowered selling interest by scrap battery recyclers, which in turn forced smelters to cut production due to the lack of raw materials.
Yuguang Closes Lead & Zinc Production Lines (1 Each) for Maintenance
Yuguang Gold & Lead and Yuguang Zinc each suspended operations on a production line for maintenance this month. This will be reflected in a decline in lead and zinc output. Yuguang Gold & Lead reported shut one of its lead production lines down on June 16 for a 42-day maintenance cycle. Its lead output is thus projected to fall by 250 mt/day and its sulfuric acid output by 350 mt/day.
Operating Rate at Secondary Lead Smelters Falls in May to New 2013 Low
SMM’s latest survey of 12 domestic secondary lead smelters revealed the average operating rate at the surveyed smelters during May fell by 8.21 percentage points MoM to 37.23%, the lowest average of the year so far.
Battery Capacity Expansion Leads to “Bogus Recovery”
LME lead prices were driven up by the improvement in the US automobile sectors in the past month, but the expansion in China’s lead-acid battery industry led to a “bogus recovery” in lead demand, which still leaves little impetus for domestic lead prices to increase.