Domestic lead scrap prices in India remained flat with a slight uptick in ingots prices. Lead markets strengthened over the week, in terms of spreads, with a contraction in the official three-month LME lead contracts which declined by $24.5/mt or 1pc to $1,833.5/mt on Tuesday from the week prior. 

 

The weekly Davis Index for lead batteries (drained) Wednesday settled at Rs82,111/mt del Delhi consumer down marginally by Rs6/mt from the week prior. Prices remained flat and trades concluded at the index price. Similarly, the index for lead batteries (drained) in Mumbai settled at Rs81,000/mt del consumer, down by Rs75/mt from the prior Wednesday. 

 

Demand is steady, said scrap sellers, despite production cuts at smelters. Post the COVID-19-related lockdown, the market was very volatility and chaotic. The market has stabilised over the week and is close to reaching a demand-supply equilibrium. 

 

Battery and ingot imports into India have dropped this week, boosting demand for local scrap in Delhi and Mumbai, this is likely to push domestic prices up in the coming week. Markets for battery scrap has strengthened over the week as spreads for the grade inched closer to LME lead, narrowing the gap from the previous week by 1pc and 2pc in Delhi and Mumbai, respectively. 

 

In Mumbai, the Davis Index for secondary lead ingot Wednesday rose by Rs383/mt and settled at Rs139,500/mt ex-works producer. Battery makers in central India are booking healthy volumes of lead, said Mumbai-based smelters. If the increase in purchase volumes are for production ramp-ups, it indicates a new wave of demand from end-users, especially, industrial and home inverter manufacturers. 

 

Auto sales in India are still sluggish, which could affect demand from auto component producers, a key end-user segment for lead ingots. Federation of Automobile Dealers Associations of India (FADA) has forecast a 42pc decline in July auto sales. This means demand for industrial batteries will surpass demand from the auto sector. The Davis Index for secondary lead ingot Wednesday increased by Rs444/mt and settled at Rs139,444/mt ex-works Delhi producer from the prior week. 

 

Smelters in Mumbai said they might raise offers if demand remains steady. Demand has increased by 2-5pc from the prior month, for some smelters in Mumbai. Some ingot producers were wary of raising offers at this critical stage as it could result in lower trades, given fresh lockdowns in suburban Mumbai and parts of Maharashtra. 

 

Markets for secondary lead ingots also strengthened during the week with spreads widening by 2pc from LME compared to the prior week. LME lead dipped by $24/mt and settled at $1,833/mt while domestic prices inched up slightly. Also, the rupee appreciated against a dollar and settled at Rs74.78 on Wednesday from Rs75.33 the prior week, further strengthening lead prices in India. 

 

Primary lead prices were offered at Rs165,100/mt, down by Rs600/mt on Monday from the prior week, shadowing a drop in LME lead prices. The official three-month LME is on a downtrend since July 13 when it settled at $1,870/mt. 

 

($1=Rs74.78)

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