Lead prices fell 0.91% in September 2019.

Price Trend

In September 2019, the domestic market of 1# lead ingots declined after the shock. The average price of domestic market was 17 150 yuan/ton at the beginning of the month and 16 693.75 yuan/ton at the end of the month, falling by 0.91%.

On October 8, the lead commodity index was 104.26, up 0.84 points from yesterday, down 22.20% from the cyclical peak of 134.01 (2016-11-29), and up 39.70% from the lowest point of 74.63 on March 19, 2015. (Note: Period refers to 2011-09-01 to date).

II. Market Analysis

Domestic market: In September 2019, Lun lead showed a low trend. The spot lead price in East China was strong. Influenced by the environmental protection and production restriction of smelters before National Day, the overall performance was relatively strong. This month, the lead price increased by about 400. The mainstream price of brand lead in Shanghai maintained around 1700-17150 yuan/ton. The mainstream quotation of brand lead in Shanghai maintains around 1700-17150 yuan/ton. The overall performance of waste batteries is weak, slightly reduced. The main quotation of waste batteries for electric vehicles is around 8800 yuan/ton, and that for automobiles is around 8100 yuan/ton. After the festival, with the end of production restriction, manufacturers began to work one after another, lead production increased, there is the possibility of a high drop.

Industry: Base metals are in a situation of blocked and pressured decline. Eurozone data is weak in the week. Britain is facing heavy resistance to leave Europe. The US House of Representatives announced a formal impeachment investigation on President Trump. The US dollar surged 99.2 points, surging 99.2 points, and basic metals fell all the way.

Supply and demand: According to data released by the International Lead and Zinc Research Group (ILZSG) on September 18, the global lead supply gap narrowed to 4,200 tons in July and 13,100 tons in June. In the first seven months of 2019, the global lead supply gap expanded to 47,000 tons, compared with a shortage of 35,000 tons in the same period last year.

According to data released by the World Bureau of Metal Statistics (WBMS) on September 18, the global lead market supply gap was 177,000 tons in January-July 2019 and 265,000 tons in the whole year of 2018. By the end of July, the total stock was 27,000 tons lower than that at the end of 2018. Unreported inventory changes are not included in consumption statistics. From January to July 2019, global refined lead production (primary and recycled) was 7.329 million tons, an increase of 11.70% over the same period last year. China’s apparent demand is estimated to be 3.577 million tons, an increase of 782,000 tons over the same period last year, accounting for about 48% of the global total. Apparent demand in the United States fell by 11,000 tons from January to July 2019. In July 2019, the output of refined lead was 105.27 million tons and the consumption was 105.74 million tons.

Domestic events:

Waste lead-acid batteries will change dramatically. Will old batteries still make money by implementing new standards on October 1st? After environmental inspections began in 2017, a large number of illegal smelters were devastated. More than 80% of the used batteries flowing into illegal channels have experienced the embarrassment of no one recycling them. Large-scale environmental inspection has made the recycling mode of waste batteries, which has lasted for more than 10 years, begin to face changes. After environmental protection supervision, the waste battery market in the past two years has been in a relatively depressed state compared with previous years.

3. Prospects for the Future Market

There will be a lot of data in Europe and the United States next week. Apart from the PMI data which is difficult to be optimistic, only the employment data in the United States can be expected. The US Dollar Index over 99 is prone to rise and fall, which will increase the expectation of opening market after the festival. The only possible expectation is the willingness to replenish goods after the festival.