Lead trades under pressure amid weak demand, supply

SHANGHAI, Jan 17 (SMM)－ SMM expects that lead will trade under pressure at 18,700-19,500 yuan/mt, supported at 18,400 yuan/mt in January due to weak demand and supply.

Supplies of lead concentrate were limited and production restrictions at smelters have yet to fully recover. Treatment charges ranged from 1,200-1,600 yuan/mt for domestic concentrate and $15-25/mt for imported concentrate.

We see primary lead output continue to dip in January due to environmental restrictions and anti-pollution measures. Maintenance works at some smelters in Yunnan and Hunan provinces and expected closures over the Chinese New Year holiday are also set to further lower supplies.

For secondary lead, smelters in Anhui province have resumed production after shortage of natural gas. Prices remained firmly supported.

On demand, January sees a gloomy market for motive batteries in electric bicycles as inventory accumulates and demand wanes. 

Buyers also continued to buy starter batteries only according to their demand in the auto storage battery market.

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