MYSTEEL: China’s lead supply up on better margins
Source: Mysteel
Dec 01, 2020 15:30
“Market sentiment prevailing in the nonferrous market is buoyant overall, and this has driven the prices of most metals up,” a Shanghai-based analyst remarked. “The uptick in prices has no doubt encouraged the lead smelters’ production willingness as their margins are gradually recovering,” she said.
China’s national average price of primary refined lead ingot (at least 99.994%) hit a two-month high of Yuan 15,263/tonne ($2,321/t) including the 13% VAT on November 23, according to Mymetal’s assessment. The price subsequently eased to Yuan 15,150/t by last Friday, though it was still up Yuan 265/tonne on week.
The average price of secondary lead (at least 99.99%) nationwide also showed a same trend, hitting a two-month high of Yuan 14,025/t excluding the 13% VAT on November 23 before sliding to Yuan 13,875/t as of November 27, also according to Mymetal’s assessment. This price was higher by Yuan 125/t on week.
Among end-users of the metal, demand from the rechargeable lead-acid batteries sector is still sluggish, Mymetal noted from some market sources. However, as most battery producers are still maintaining their current output and undertaking raw materials procurement according to their production needs, lead demand is still relatively stable. The lead smelters continue to crank up production in response.
Over the past week, some secondary lead smelters were less determined to bolster their offering prices to any great extent however, in order to sell as much tonnage as possible – a strategy which seemed to work, Mymetal also observed.
By November 29, the inventories of primary lead ingots at commercial warehouses in the five major markets Mymetal monitors had grown to 39,150 tonnes, up by another 2,450 tonnes or 6.7% on week and a new high since late July.
Written by Victoria Zou, zyongjia@mysteel.com, and Mary Li, lixiaomei@mysteel.com
Edited by Russ McCulloch, russ.mcculloch@mysteel.com
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