Thin profits, sluggish consumption to lower Dec operating rates at secondary lead smelters

SHANGHAI, Dec 25 (SMM) – Operating rates across Chinese secondary lead smelters are expected to fall by 1.04 percentage points month on month to stand at 49.51% in December as narrowed profit margins and continued sluggish consumption across end-users prompt smelters to cut output.

Output of secondary lead is estimated to come in at 140,600 mt in December, down some 3,000 mt from November, SMM data showed.

In December, declines in lead prices pushed secondary lead smelters to the brink of losses while continued poor consumption across end-markets caused battery producers to rein in stocks.

SMM learned that part of Anhui Huabo’s capacity suspended operation for equipment issues for about two weeks earlier this month. This is set to sharply lower December’s overall output.