After the May Day holiday, Shanghai lead rose for three consecutive working days, and on the 7th, it rose to 17790 yuan/ton in the Shanghai lead market, setting a new high in five years since March 2019.
| POLYVINYL ALCOHOL |
According to the commodity market analysis system of Business Society, the domestic price range for lead ingots on May 8th was 17350-17500 yuan/ton, with an average price of 17425 yuan/ton, an increase of 225 yuan/ton compared to the previous trading day.
Macroscopically, during the May Day holiday in the international market, the Federal Reserve announced that interest rates would remain unchanged, which basically met market expectations. However, non farm employment data performed poorly, with the US dollar index falling and the overall performance of the non-ferrous market being better. The favorable policies in the domestic market have increased, boosting the domestic market mentality, and the overall macro mentality is improving.
Supply side: Due to the impact of raw material supply, the expected supply of lead ingots is tight
The supply at the mining end is still tight, and the lead processing fees are still operating at a low level, which has affected the lower production of primary lead enterprises; At the end of April, the recycled lead industry introduced a “reverse invoicing” policy, which has affected the recycling of waste battery enterprises. The procurement of raw materials for recycled lead enterprises has been difficult, and the operating rate has declined. Furthermore, the cost of purchasing waste batteries may increase due to the policy’s impact. Currently, the recycling industry has a strong wait-and-see atmosphere. Some companies have maintenance plans by the end of this month, and the expected supply of recycled lead is tight.
In terms of demand: End consumer demand support during the off-season
| PVA 1799 (PVA BF17) |
May is a seasonal off-season for battery companies, and the demand for battery replacement in the end market is weak. Currently, battery companies are still actively digesting existing inventory, and the cost pressure for battery companies is relatively high. They need to maintain essential procurement of raw materials. The off-season for terminals has also slowed down the rate of scrapping of used batteries, making the current supply of recycled lead tight.
Outlook for the future: Overall, the macro market atmosphere is currently warm, and the expected supply of lead ingots is tight. Although the downstream industry is in the off-season, the reduction in scrapped waste batteries has also exacerbated the problem of tight supply of raw materials for recycled lead enterprises. Lead prices will continue to remain strong in the short term, boosted by tight supply.
Related data:
According to ILZSG, an international lead and zinc research group, it is expected that there will be a global surplus of 40000 tons of refined lead supply in 2024. The global demand for refined lead is expected to increase by 1.9% to 13.42 million tons, and lead ore production is expected to increase by 1.8% to 4.59 million tons. ILZSG expects a global surplus of 56000 tons of refined zinc supply in 2024. The global demand for refined zinc is expected to increase by 1.8% to 13.96 million tons, and zinc ore production is expected to increase by 0.7% to 12.42 million tons.
On May 7th, the total LME lead inventory was 258800 tons, a decrease of 7200 tons compared to the previous trading day. The Singapore warehouse decreased by 3350 tons, the Kaohsiung warehouse decreased by 1775 tons, the Busan warehouse decreased by 1025 tons, the Guangyang warehouse decreased by 1025 tons, and the Laiheng warehouse decreased by 25 tons. The inventory levels in other regions are temporarily stable.
| http://www.polyvinylalcohols.com |