China’s lead market, the world’s biggest, may swing to a shortage next year as growth in sales of lead-acid batteries boosts demand, according to Beijing Antaike Information Development Co.
Consumption will probably climb 8.9 percent to 4.91 million metric tons, while output may gain 5.2 percent to 4.9 million tons, analyst Hu Yongda said in an interview in Nanjing yesterday. That signals a 10,000-ton deficit from a 150,000-ton surplus, Antaike data showed.
Lead traded in London has climbed 7.3 percent in the past year, becoming the only one among the six industrial metals to increase. The marginal deficit will likely keep inventories low in the largest user, supporting prices and potentially boosting imports, which climbed 5 percent in the first three quarters. China’s Communist Party today starts a Congress to choose new leaders amid signs that the second-biggest economy is recovering from a seven-quarter slowdown.
“Lead-acid batteries will continue to play a dominant role in cars, telecommunications, e-bikes and energy storage among various types of batteries,” said Liu Yanlong, secretary general of the China Industrial Association of Power Sources.
China shut down as much as 90 percent of battery makers and recycled-lead producers that didn’t meet environmental standards last year after reports of lead poisoning in Zhejiang and Guangdong. Lead usage in batteries accounts for 80 percent of China’s consumption, according to Antaike. The country’s lead consumption accounted for 44.5 percent of the world total in 2011, according to the International Lead and Zinc Study Group, which expects a global surplus of 170,000 tons next year.
“Big lead-acid battery makers have taken advantage of the environmental crackdown to expand their production to grab bigger market shares,” Liu said.
Production of lead-acid batteries is forecast to rise to 266 million Kilovolt-Ampere Hours in 2015 from 137 million KVAh last year, said Liu. Electric bikes, which accounted for 38.8 percent of global battery usage last year, will continue to be the biggest consumer, while electric and hybrid cars could also see strong growth if governments release supportive policies, Liu said at Antaike’s annual lead and zinc conference.
Lead-acid battery output in the first three quarters this year jumped 28 percent to 112.19 million KVAh, Antaike cited data from the National Bureau of Statistics.
China’s refined lead output rose 10.4 percent from a year ago to 3.52 million tons in the first three quarters, and 29 percent of that was recycled lead, according to Antaike.