Domestic lead scrap prices rose by almost 2pc in the week ended Sep 2 from the prior week on improved demand from smelters. Lead market strengthened in terms of spread during the week as LME lead rose by $4/mt or 0.2pc on Tuesday and settled at $2,009/mt from a week ago while domestic prices rose by around 2pc in the same week.
The Davis Index for lead batteries (drained) in Delhi Wednesday rose by Rs1,062/mt ($14.5/mt) to settle at Rs82,500/mt del consumer from the prior week while the index in Mumbai increased by Rs1,596/mt to Rs85,625 del consumer. Improved demand from smelters have led to higher offers but are unlikely to sustain amid ample supplies, said a Mumbai-based trader.
The index for secondary lead ingot in Mumbai rose by Rs1,089/mt to Rs149,500/mt ex-works producer from the preceding week. Smelters raised offers on the back of demand from battery makers. Auto sales turned positive in August from the prior year which instilled confidence in the lead market as Q3 (Oct-Dec) is known to be the best quarter in terms of sales. Ingot makers, however, rued high input cost which has reduced their margins. They continue to refill their inventories amid fears of a further hike in scrap prices. The Davis Index for secondary lead ingot in Delhi on Wednesday fell by Rs187/mt to Rs144,813/mt ex-works producer as trades thinned.
Smelters in Mumbai appreciate the government’s Aatmanirbhar or self-reliance movement which has positively impacted the Indian lead market. The import substitution policy has strengthened the market and boosted domestic manufacturing, according to market participants, who believe India is a big market in itself both for production as well as consumption.
The market for scrap in Mumbai strengthened as spreads contracted by 2pc from the previous week as LME rose by a modest 0.2pc from the prior week and domestic prices rose by almost 2pc. Similarly, the market for lead scrap in Delhi improved too as spreads contracted by 2pc and prices rose by 2pc from the prior week, higher than LME lead gains.
Secondary lead ingots market in Delhi was reinforced as spreads widened by a little over 1pc despite domestic prices being flat from the prior week. In Mumbai, the market for secondary lead ingots strengthened too as spreads widened by over 2pc from the week prior as domestic prices rose slightly but higher than LME gains. Markets for lead scrap and ingots has improved in the week as the Indian rupee gained around 1.3 points against the US dollar from previous Wednesday.