India: Lead semis imports fall 7% m-o-m in Jul'24 on increased domestic output, rising scrap imports

In July 2024, semi-finished lead imports reached 38,014 tonnes (t), a drop of 7% m-o-m as compared to 41,046 t in June 2024. The decrease in volume was primarily driven by an increase in domestic semi-finished output along with an increase in imported scrap arrival, which reduced reliance on imports of semi-finished ingots.

Meanwhile, imports jumped over 45% y-o-y compared to 25,816 t in July 2023.

South Korea emerged as the top exporter of semi-finished ingots to India, with 10,242 t, followed by Malaysia at 4,730 t, Indonesia at 2,863 t, and the Philippines at 2,650 t, respectively.

Moreover, lead scrap imports surged by 33% to 19,536 t in July 2024, up from 14,714 t in June 2024. On a y-o-y basis, imports rose dramatically by 121% compared to 8,842 t in the previous year. A grade-wise examination shows that the top grade imported was radio, which increased by 16% m-o-m in July 2024 to 9,136 t in comparison with 7,847 t in the previous month. Radio was followed by rink at 8097 t, up by 126% m-o-m compared to 3,585 t in June 2024, and relay at 1,125 t in July 2024, a 44% decline in comparison with 2,026 t in June 2024.

The top exporter to India for scrap in July 2024 was the US at 6,947 t, followed by Canada at 2,073 t, and the UK at 1,862 t, as per provisional data maintained with BigMint. Exports from other countries stood at 8,654 t.

What led to a drop in semi-finished imports?

Increased domestic production: Due to increased domestic production of semi-finished lead, which rose over 10% to 21,000 t in July 2024 from 19,000 t the previous month, imports declined. This boost in production led to a decline in imports, as local output sufficiently met domestic demand.

Meanwhile, on a y-o-y basis, semi-finished lead production surged by 31% in July 2024 against 16,000 t in the previous year.

Declining LME lead prices: In July, LME lead prices experienced a significant drop, resulting in a decrease in overall lead prices. This decline had a notable impact on the Indian market, leading to a reduction in imports of lead semi-finished products. Consequently, there was a shift in focus towards increasing imports of lead scrap, as it is a more cost-effective alternative. Lower lead prices made scrap more attractive for processing and reuse.

The average LME lead price decreased by 2% in July 2024 to settle at $2,155/t in comparison with $2,198/t in June 2024. Additionally, metal stocks at LME-registered warehouses showed positive trends, rising over 10% in July 2024 to 224,834 t, up from 204,520 t in the previous month.

Outlook

Looking ahead, imports of semi-finished lead are expected to stay rangebound, as imports of scrap and the domestic production of lead ingots have remained consistent. These factors will reduce reliance on imports of lead semis.