From July's Dip to August's Upturn: China's Recycled Refined Lead Production Trends

In July 2024, secondary lead production was 308,300 mt, down 7.03% MoM and 17.94% YoY. From January to July 2024, cumulative secondary lead production was 2.2434 million mt, down 9.88% YoY. In July 2024, secondary refined lead production was 254,700 mt, down 7.69% MoM and 24.02% YoY. From January to July 2024, cumulative secondary refined lead production was 1.8997 million mt, down 12.38% YoY.

In July, the retirement volume of battery scrap did not show significant improvement, and by the end of the month, the tax-inclusive price of battery scrap surged significantly, reaching around 12,200 yuan/mt. Battery scrap traders were bullish and reluctant to sell. Secondary lead smelters faced dual pressures of high raw material costs and poor arrivals, increasing their willingness to conduct maintenance and suspend production. Additionally, with the implementation of the Fair Competition Review Regulations starting August 1, secondary lead smelters anticipated the cancellation of preferential tax rebate policies by local governments, leading to a strong sentiment of production suspension and wait-and-see. The production decline in July was significant. Entering August, some smelters suspended production due to the wait-and-see attitude towards policy implementation and the decline in lead prices, resulting in a depressed market sentiment. However, smelters that previously suspended production due to equipment failures, maintenance, or license renewals gradually resumed operations. Overall, SMM expects that secondary refined lead production in August may increase by 14,700 mt to 269,500 mt.