SMM12, 27 July: trade frictions between China and the United States intensified in 2018, European international relations were in turmoil, the Federal Reserve raised interest rates frequently, macroeconomic pessimism and risk aversion increased, and the center of gravity of colored varieties under pressure shifted downward, but we found that the price of lead was lower than that of other non-ferrous metals. The operating center of gravity has not continued to move down, which may be related to its complete fundamental pricing, with lead prices running between 17280 and 20810 yuan per ton during the year. In SMM's view, the 2018 lead price trend is basically in line with the expectations of the industry, so will the 2019 trend continue to be strong? SMM believes that the production of primary lead is declining and the recycled lead industry is in a state of upgrading of industrial structure. Shanghai and Guangdong stocks were low in 2018, and lead prices were fluctuating at a high level. China's lead supply is expected to oversupply or expand in 2019. SMM estimates that the operating range of lead is 1850 to 2450 US dollars / ton and 16500 to 20500 yuan / ton in Shanghai. "View detail
According to the trend of lead price in 2019, SMM investigated the views of 100 enterprises, including 22 lead mining enterprises, 33 smelting enterprises, 21 traders and 24 downstream lead battery enterprises. 12% of companies are bullish, 64% are bearish, and another 24% are bearish. These companies mainly believe that the supply of refined lead will remain surplus, but the low profit of recycled lead plants and low social inventory give strong support to lead prices.
In addition, we interviewed the views of a number of organizations, as follows:
Yide futures: in 2019, the supply of lead concentrate at home and abroad increased slightly, but due to the small profit margin, the supply of reduced lead remained basically stable compared with 2018, and the disassembly capacity of new batteries increased by 2.6 million tons from 2018 to 2019. Although the supply of recycled refined lead is obviously affected by environmental protection, waste battery supply, recovery price and the profit of recycling enterprises, promoting the recovery and reuse of waste battery will become the trend in the future, and the output and proportion of recycled refined lead will maintain the trend of growth. On the demand side, the traditional mainstream consumer industry is limited by new regulations and technical bottlenecks, the amount of refined lead will be compressed, traditional cars and new energy vehicles have been overdrawn, and there is a greater chance of maintaining negative growth in 2019. Trade friction between China and the United States will always be the export of lead batteries. Although the communications industry is booming, it will contribute little to lead consumption. In 2019, the lead market will show an oversupply, and the focus of price fluctuations will shift further.
Guangzhou Futures / Li Jun: on the supply side, due to the continued strict environmental inspection, the supply of primary lead is limited, but due to the gradual release of renewable lead production capacity, the proportion of renewable lead supply will gradually increase, resulting in a substitute for the demand for primary lead. On the demand side, the car market is gradually weakening, exports may be difficult to improve next year, and the demand-side boost to lead prices is limited. It is estimated that the concussion of lead in Shanghai is weak in 2019, with an operating range of 17000 to 19500 yuan / ton.
Guotou Anxin / Xiao Jing: the price of lead is independent of the inner and outer plates, and the reference to lead in Shanghai is of little significance. The price performance of lead in Shanghai is expected to fluctuate in 2019. With the further release of the standardized production capacity of the recycled lead industry, which accounts for more than 45% of the domestic lead production, the negative impact of environmental protection on the supply of recycled lead is weakened, and the stability of the output of recycled lead is enhanced. At the same time, on the demand side, batteries that account for more than 80% of the consumption of lead-acid batteries are under greater consumption pressure under the background of lightweight electric bicycles, lithium shock of new energy vehicles, and the formation of the cascade utilization of power batteries in mobile communication base stations. Export uncertainty is also strong. Domestic lead prices are expected to weaken to 17000 yuan per ton as a whole. Structural trading opportunities revolve around the lack of deliverable lead ingots. At present, the delivery brand of the previous period is mainly primary lead, the quality assurance of primary lead is strong, and the circulation of spot trade is less. Therefore, it is not ruled out that there will still be a squeeze on individual contracts in 2019, which is expected to easily appear after a smooth decline with strong volatility.
South China Futures: for the 2019 lead market, we think lead prices may weaken slightly. On the supply side, the global supply of lead concentrate has maintained a trend of growth compared with 2018, but the domestic supply of refined lead is not expected to increase significantly due to smelting costs and the production of recycled lead. It is an inevitable trend that the proportion of recycled lead in refined lead continues to increase, so the focus of the supply side will shift from the supply of lead ore to the supply of recycled refined lead, but the recovery and dismantling of waste bottle batteries will become the main constraint to the expansion of recycled lead. On the demand side, the mainstream industry of traditional consumption is weak, the contribution of the communications industry is small, and the market share of lead batteries continues to be swallowed up. It is expected that the overall lead consumption market will decline in 2019, and the lead price may weaken.
The point of view is being updated.
SMM "2018 China lead Industry chain Research report" will be released soon, containing the latest views and data of the SMM lead Research Group. If you have any requirements, please contact Wu Tingting: 13795448891. You are also welcome to visit the SMM website to pay attention to the free news and price services provided by the lead Research Group.
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