China's primary lead output was down by 4.60% but up by 5.19% to 261,500 tonnes in February, according to Mysteel's survey of 35 primary lead smelters, with a total capacity of 3.85 million tonnes and a coverage rate of 91.56%. Apart from the reason that there were three days shorter in February than in January, a smelter in Hunan province stopped production during stocktaking and a smelter in Henan province just resumed production at the end of February for maintenance. These two smelters resumed normal production in March, so the primary lead output is expected to increase by 33,100 tonnes in March.
Data Source: Mysteel
Thanks to battery factories actively resuming production and replenishing raw material inventory after the Spring Festival, lead ingots total inventory in China's five major markets were down by 8,100 tonnes month on month to 53,800 tonnes at the end of February, according to Mysteel's statistics. Wherein, inventory in Shanghai increased by 3,300 tonnes to 13,900 tonnes, Jiangsu decreased by 3,600 tonnes to 5,600 tonnes, Zhejiang decreased by 3,500 tonnes to 16,500 tonnes, Guangdong increased by 1,200 tonnes to 6,500 tonnes, and Tianjin decreased by 5,500 tonnes to 11,300 tonnes. However, the social inventory in March is expected to increase slightly since March is traditional off-season for battery consumption and battery factories will not be so active to purchase raw materials.
Data Source: Mysteel
Overall, with the significant increase in primary lead output but entering the off-season of battery consumption, it is difficult for lead prices to rise. So, the Shanghai Futures Exchange lead's main contract may be around Yuan 15,100-15,500/t.
For regular reports or more data, please contact Paula Xu at xuzhongping@mysteel.com
Written by Durand Du, duxiaoyu@mysteel.com
Edited by Paula Xu, xuzhongping@mysteel.com