SHANGHAI, Jan 29 (SMM) – Chinese secondary lead smelters are expected to operate at a lower rate in January as most plants begin their Chinese New Year break later in the month.
Operating rates across secondary lead smelters are expected to average 47.78% in January, down 2.6 percentage points from December, SMM data showed. They are estimated to produce 135,700 mt of secondary lead for the month, down some 7,400 mt month on month.
Most secondary lead smelters who own production licences planned to close for CNY at the end of the month while those without licences would shut in the second half of January.
Downstream consumers usually stockpile raw materials before the CNY break and this would bolster the demand. This year’s stockpiling turned out less brisk than previous years as a sluggish end-market demand and a bearish outlook on lead prices deterred downstream consumers.
Low lead prices have pushed secondary lead smelters towards negative terrain. This, together with weaker-than-expected demand, also eroded production enthusiasm among secondary lead smelters.