US lead scrap prices ticked up by around a penny on Wednesday, as supply and demand leveled off for lead batteries and lead scrap exports strengthened.
The weekly Davis Index for whole undrained batteries trended up by 0.1¢/lb to 34.6¢/lb delivered US consumer on Wednesday because supply and demand balanced in both the domestic and export markets.
The batteries market has leveled off, with both producers and scrapyards building their inventories for the next seasonal wave, expected in mid-winter when the consumption and supply of batteries increases because of the cold weather. Replacement of old batteries also declined this year, according to some market participants, because the economic downturn dissuaded consumers from replacing their old cars.
In fact, a recent IHS Markit report estimated the average age of light motor vehicles increased by a month this year to 11.9 years. The report cited declining new vehicle sales as the key reason.
The lead scrap indexes climbed on Wednesday amid rising export demand for the grades. The weekly indexes for heavy soft lead increased by 1.2¢/lb to 72.5¢/lb delivered and rose by 1.7¢/lb for hard lead to 69¢/lb delivered on Wednesday.
Premiums moved up for the second consecutive week, with the Davis Index for lead ingot premium climbing by 0.2¢/lb to 9.2¢/lb under the three-month LME Lead contract, despite a slight decrease in weekly LME lead prices.
The official three-month LME Lead contract closed Wednesday at $1,979/mt, down by $15.50/mt from $1,994.50/mt on August 26.