SHANGHAI, Jan. 16 (SMM) – The average operating rate at major Chinese primary lead smelters fell by 7.34 percentage points on the month to 58.39% in December 2014, SMM’s latest survey indicates.
Spot lead prices fell to their 2014 low at 12,575 yuan ($2,053) per tonne in December on slumping SHFE lead. Lead smelters in Henan announced output cuts by 15% to 30% in response to depressed prices, resulting in a marked fall in the average operating rate.
Total lead output at Henan’s smelters decreased by nearly 5% from November SMM research shows. In other news, Henan’s Yuguang Gold & Lead, Anyang Minshan Nonferrous Metals and Lingbao Xinling Lead have also joined in production cuts or suspension for maintenance cycles in January. As such, lead output in the province is expected to be slashed by 15-20% from November in January.
Meanwhile, some large smelters in Yunnan’s Gejiu area also halted production for maintenance in December, leading to a sharp fall in the average operating rate at small primary lead smelters.
In January, SMM expects primary lead output to be cut by over 20,000 tonnes from December and the average operating rate at primary lead smelters to fall further.
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