SHANGHAI, Jul. 2 (SMM) - Battery scrap processing rate is unlikely to drop further in China from this year’s low of 37% even as summer low season approaches, according to an analyst at Shanghai Metals Market (SMM).
``Room for further declines is limited’’ as the rate has been low enough comparing to a normal level of 50%, Zhu Rongrong, SMM’s lead analyst said in daily morning call today.
Battery scrap processing rate fell to around 37% in May from 45% in April due to low secondary lead prices, according to Zhu’s survey of 12 top recyclers.
``Lackluster downstream demand remains an important factor in limiting secondary lead production,’’ Zhu wrote in a June report. The market of power batteries, which are used in e-bikes, has been particularly pressured by high inventories, she wrote.
SMM’s #1 lead prices fell below 14,000 yuan ($2,264) a ton for the first time this year in May. The prices were reported between 14,200-14,400 yuan a ton today.
Secondary lead accounts for 25%-30% of China’s total annual output of the heavy metal, according to Zhu.