Lead prices across grades rose on Wednesday from the prior week amid a rise in LME levels that influenced offers in Delhi and Mumbai. The official three-month LME lead rose by $25.2/mt, or 1.20pc, to $2,148/mt on Tuesday from last week. Lead markets strengthened in terms of spreads.
The weekly Davis Index for lead batteries (drained) for Mumbai settled at Rs93,100/mt ($1,287/mt) del consumer, up by Rs1,600/mt on higher offers prompted by rise is LME levels. Prices of secondary lead ingot also rose in line with raw material prices. The weekly Davis Index for secondary lead ingot in Mumbai rose by Rs2,011/mt to Rs155,900/mt ex-works producer.
Markets for lead grades strengthened in Mumbai in terms of spreads. The index for Mumbai battery scrap increased by 1.75pc and the spreads for the price index narrowed by 0.73pc. Index for secondary lead ingot in Mumbai jumped 1.31pc and the spreads for the price index widened by 0.79pc from the previous week.
Demand is on the lower side in comparison to same period in the previous year. Pre-summer season in India is the time when demand should start climbing, but it is not the case as yet, smelters said. With the arrival of summer season, demand for finished goods including UPS and invertors increases, which results in higher consumption of secondary lead ingots. Demand for lead is under-performing even when compared to other base metals.
The weekly Davis Index for lead batteries (drained) Delhi on Wednesday settled at Rs94,944/mt del consumer, up by Rs1,611/mt. The index gained over 1.73pc from the previous week while spreads for the price index narrowed by 0.73pc, indicating a strengthened market. The weekly Index for secondary lead ingot settled at Rs160,833/mt ex-works Delhi producer, up by Rs2,333/mt as offers rose in tandem with rising LME. Spreads for the price index widened by almost 1pc compared to the previous week.
If demand continues to slide, then prices would gradually come down in the coming weeks. Also, demand from auto sector is lower given the production cuts amid shortage of semiconductors. Several reports suggest that in Q1 (Jan-March) auto production will be severely hit, which will also affect the consumption of batteries and, in turn pressure prices of secondary lead ingot and scrap.
($1 = Rs72.3)