Domestic lead prices of scrap and ingot fell by 1-2pc in a week on Wednesday due to low bids in a quiet market. Prices were expected to fall in line with LME levels this week as domestic prices were moving in contrast to LME since past couple of weeks.
The official three-month LME lead contract on Tuesday settled at $1,975/mt, up by $10 in a week, or up 0.51pc. In last one month, LME contract dipped 8pc while lead grades that we track were down 2pc in Mumbai and 1pc in Delhi. Domestic prices maintained stability all these weeks when LME was gradually climbing down, but lower bids in line with LME finally led prices to decline on Wednesday.
The weekly Davis Index for lead batteries (drained) settled at Rs93,917/mt ($1,293/mt) del Delhi consumer, down by Rs1,883/mt from a week ago, driven by low bids. Smelters in Delhi also revised their prices in line with LME and lowered raw material prices. The weekly Davis Index for secondary lead ingot on Wednesday settled at Rs158,917/mt ex-works producer, down by Rs2,088/mt. Demand is stable but market participants expect it to pick up from the next week after Holi.
Markets in Delhi weakened in terms of spreads for both the grades. Spreads for lead batteries (drained) price index widened by 1.70pc from the week prior while for secondary lead ingots, the spread for the price index contracted by 2.10p from the previous week.
Mumbai prices for lead scrap and ingot fell almost to the same extent compared to Delhi. The weekly Davis Index for secondary lead ingot for Mumbai on Wednesday settled at Rs153,417/mt ex-works producer, down Rs2,083/mt driven by consistently lower bids which resulted in market prices to decline.
Lower trades in the prior week coupled with a decline in raw material prices drove smelters to reduce offers finally. Some market participants are forecasting prices to go up to Rs156,000-157,000/mt for Mumbai in the near term but some said prices may remain flat or inch up slightly until the festival of Holi. Trades should pick up after Holi as inverter production is usually ramped up which creates demand for secondary lead ingot and lead batteries (drained) scrap.
The market for lead weakened in Mumbai in terms of spreads this week. The spread for secondary lead ingot price index contracted by 2.08pc and the price index for lead batteries (drained) widened by 1.89pc compared to the prior Wednesday spreads.