Lead social inventories fell on week as secondary lead supply failed to normalise

SHANGHAI, Mar 6 (SMM) – Social inventories of lead ingots in China extended their declines this week, as secondary lead smelters failed to contribute to output significantly. 

SMM data showed that lead social stocks across Shanghai, Guangdong, Zhejiang, Jiangsu and Tianjin shrank close to 4,000 mt in the week ended March 6 to 37,600 mt, after s decline of of 600 mt in the previous week. 

Downstream lead-acid battery producers resumed operations steadily, while secondary lead smelters remained in the stage of restocking feedstock battery scrap and have not normalised output of secondary refined lead. This is especially the case in Zhejiang, Jiangxi and Anhui provinces where most Chinese lead-acid battery mills are located, which means that local battery producers could only rely on supply of primary lead as raw materials. Limited availability of primary lead drove consumers to the trading market, and this accounted for the decline in social inventories. 

SMM expects the decline in lead social stocks to narrow next week as secondary smelters resume production successively and some primary smelters will recover from maintenance.