China's primary lead output fell 8.2% in January on seasonality

SHANGHAI, Feb 7 (SMM) – Primary lead output in China declined as expected in January on the back of a holiday lull. SMM data showed that domestic output of primary lead stood at 257,000 mt in January, down 8.2% on the month and 6.3% on the year.

During the CNY holiday (January 24-February 2), Hunan Yuteng and Yunnan Zhenxing conducted equipment maintenance and some medium-scale and small producers of primary lead halted production for a week. Large-scale primary lead smelters, meanwhile, maintained normal operations during the holidays. The escalated virus outbreak over the holidays caused a limited impact on lead production. 

As measures have been taken to contain the spread of the virus after the CNY holiday, smelters that suspended over the holidays are compelled to postpone their resumption. But producers that continued operations during the holiday feel limited impact. Hunan Yuteng, Yunnan Zhenxing and some other smelters that underwent overhaul over the holidays remain shut, with recovery likely to be delayed. 

Some primary lead smelters may scale back production in the near term if transportation controls remain in place, as raw material inventories have been depleted with stocks of lead ingot and by-product sulphuric acid piling up. SMM estimates a decline of nearly 20,000 mt in primary lead output in China this month.