SMM review of domestic output of refined lead

In September 2023, the domestic output of refined lead was 315,900 mt, a drop of 0.94% month-on-month but up 7.04% year-on-year. The cumulative output from January to September 2023 increased by 16.45% year-on-year. Total production capacities of enterprises in the survey totalled 5.84 million mt in 2023.

According to the survey, the production of most refined lead smelting enterprises in September did not change much compared with August. Only a few large smelting enterprises had production changes. There were large enterprises in Henan recovering after maintenance, while smelting enterprises in Henan and Inner Mongolia undertook maintenance. Therefore, the increase and decrease in production in September were roughly balanced. The supply tightness of lead concentrate has intensified due to the starting of stockpiling for winter production, and TCs were lowered further. Some smelting companies in Yunnan, Hunan and other places experienced a shortage of raw materials, and their actual output was lower than the planned amount in September.

In October, medium and large lead smelting companies in Yunnan and Jiangxi are undergoing maintenance. At the same time, many smelting companies in Henan and Inner Mongolia resumed production after maintenance. It is expected that refined lead output will grow in October. The weather in the north has turned colder, and the difficulty of mining lead concentrates in high-altitude areas will increase. In addition to factors such as transportation, the supply of lead concentrates in the market will become increasingly tight. Against this background, the TCs of imported lead concentrate have been gradually lowered recently. The SMM TCs of domestic lead concentrate in October were 800-1,100 yuan/mt with metal content, and the TCs of Pb 60% imported lead concentrate were $30-50/dmt. Output at refined lead smelters is likely to fall short of expectations due to raw material shortages. SMM expects China's refined lead output to increase to 324,000 mt in October.