SHANGHAI, Jul. 1 (SMM) – China has decided to cut VAT rebate for scrap lead recycling operations from 50% to 30%, effective July 1, 2015. In response, many secondary lead smelters lowered their procurement prices for scrap batteries, SMM learned.
The rebate rate fall will lead to an about 200-yuan-per-tonne rise in raw material cost for secondary lead smelters. However, most smelters in Hebei, Hubei, Jiangsu, and Henan only cut the procurement prices by 100 yuan per tonne considering the tightness in scrap supply, SMM understood.
Smelters in Anhui left purchasing prices unchanged at the moment.
“The cut in VAT rebate may add 400 yuan per tonne to total secondary lead cost, and some larger producers will have to run at lower utilization rate should they fail to reduce cost by pressuring scrap battery prices,” SMM research team says.
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