The weekly Davis Index for US whole undrained batteries was flat at 32¢/lb delivered US consumer on Wednesday, but the index for domestic lead scrap declined significantly.
In the short-term, lead battery prices are expected to move in a narrow range because demand is seasonally weak and there’s a supply glut from the winter, market participants said. Demand for batteries is typically low during spring, but mild winter weather resulted in excess new batteries supply, as peak-season sales were below expectations.
However, in the medium-term, sellers are bullish on the batteries market. According to some market participants, consumers will keep their old cars longer because of the economic downturn, and it could result in them changing their batteries more than once. If that happens, battery demand will rise.
The index for heavy soft lead decreased by around 4¢/lb to 61¢/lb delivered US consumer, and the index for hard lead declined by around 6¢/lb to 58¢/lb delivered on Wednesday.
Market participants expect these steep price declines to continue in the short-term, as lead mines and car manufacturing facilities have suspended operations to contain COVID-19’s spread.
The three-month official LME lead contract closed Wednesday at $1,702.50/mt, increasing by $95.5/mt from $1,607/mt on March 25.