Lead scrap and ingot prices in India remained almost flat to up following a similar trend in LME lead in the week ending Aug 5. Scrap prices rose between Rs200-300/mt ($2.6-4/mt) from the week prior. In Delhi, lead ingot prices rose by Rs616/mt, while they fell by Rs400-500/mt in Mumbai. The three-month LME lead contract settled at $1,852.5/mt on Tuesday, up by $2/mt from the prior Tuesday.
Delhi
The Davis Index for lead batteries (drained) on Wednesday settled at Rs79,500/mt del Delhi consumer, up by Rs286/mt ($3.8) from the week prior. Recycled battery demand was projected to rise this week with the ramp-up of operation by smelters. The Davis Index for secondary lead ingots rose by Rs616/mt to Rs141,231/mt ex-works Delhi producer on Tuesday from the previous week.
Smelters said that orders from battery makers have improved in the first week of August resulting in a slow but gradual rise in prices. Secondary lead ingot prices are rising since mid-July, smelters are, however, not sure if demand would grow any further given the peak season for UPS and inverters to have almost ended. The month of August has historically been the slowest month for lead consumption.
Scrap market in Delhi improved as spreads narrowed slightly during the week from LME levels and the market for secondary lead ingot strengthened as spreads widened marginally from LME levels.
Mumbai
Smelters have ramped up operations in Mumbai and nearby region, but trading is more brisk in the city as the region recovered later due to the extension of pandemic restrictions for a longer period. Amid a sudden rise in availability of secondary ingots due to eased restrictions, prices dropped but demand remains constant, said Mumbai-based traders. The Davis Index for secondary lead ingot dipped by Rs472/mt to Rs141,385/mt ex-works producer on Wednesday.
In central India, the demand from battery makers has improved on the back of a recovery in auto sales. Battery makers said demand from auto companies could rise in the coming weeks and they are banking on it to recover the losses made during the lockdown. The Davis Index for lead batteries (drained) rose by Rs304/mt to Rs78,929/mt del Mumbai consumer on the back of smelters resuming operation lately. Smelters said that deliveries were stalled since the past two days due to highways being chocked by rains. Monsoon has started disrupting the city’s operations.
The market for lead scrap in Mumbai strengthened this week as spreads slightly tightened from LME lead compared to the previous week. The market for secondary ingots, however, weakened with spreads narrowing by 1pc from LME levels compared to prior week as domestic prices slipped.
Primary lead prices stood at Rs165,500/mt on August 3 and is expected to go higher with demand improving from end sectors. Auto sector sentiments are positive as July sales marks a significant improvement. Major automakers said they are ramping up production ahead of the festive season, which will lead to higher demand for lead batteries. Traders said Q3 and Q4 are the best quarters in terms of demand and could potentially bring the market to pre-COVID levels.
($1=Rs74.9)