In terms of the supply and demand balance, the market looks tighter for lead than for other industrial metals.
Like the rest of the base metal complex, lead prices are trading well below the levels in 2011. However, since May 2013, the picture seems to look brighter for lead than for other industrial metals.
This might be explained by the US auto industry’s recovery over the course of 2013. Indeed, the US doubled its lead imports over the first half of 2013.
However, the month of January wasn’t a great month for lead prices – they fell by 6 percent on the LME. But, that information can be misinterpreted.
We see that drop as a normal market correction. In fact, prices seem to be finding support again this month, as we would have expected.
What This Means For Metal Buyers
Lead prices might keep gaining support during the coming months. However, the uptrend is far from being strong, and we still don’t see lead trading above $2,500 per metric ton on the LME.
It might make sense to wait until prices show real strength before taking long-term commitments.