It has already been a month since the start of the new year, and the domestic lead battery scrap market has remained unchanged from last December. Automotive lead battery scrap costs 50-60 yen per kg. The reason for this price difference is due to the rise of Chinese traders, who have been gaining momentum since last year. The domestic price of lead plate（japanCalled to sunamari) is 110-115 yen per kg (the price purchased from primary lead refiners), which is also unchanged from last year.

 

→Update on Lead Battery Scrap #21: Stronger due to increase in Chinese dismantlers, 70-80 yen in the future?

 

The purchase price from Chinese lead scrap dealers (battery dismantlers) is 55-60 yen, but every year during this winter season, there is a seasonal glut of battery scrap and the market tends to fall. This year, however, there is no such tendency," a person from the lead battery recycling business have said.

 

The recent cold weather (since 1/24) is expected to increase the occurrence of scrapped batteries, especially since the number of replacements increases due to battery failure when the cold weather becomes more severe.

 

Recent LME lead market prices ($/ton) and lead quotes (yen/kg) are shown below.

 

In contrast to the LME lead market price, the marked decline in the domestic lead price is due to the appreciation of the Japanese yen.

Therefore, depending on the contract basis, crude lead (bullion) export prices are also likely to have fallen due to the yen.

 

Trends in exchange rates (yen-dollar TTS) and bullion prices ($/ton) Recent 3 months.

 

January is the month of New Year's in Japan, and the Chinese New Year begins on the 20th, which means fewer business operation days than in other months, so the market is not currently experiencing any turbulence. However, as mentioned above, the battery scrap market usually declines in January and February during the season of increased production, but this is not the case now, and the current situation gives a sense of turbulence in the future.

 

Chinese traders, who were initially under the spotlight for illegal dismantling and exporting (or are now being marked), purchased lead battery scrap for value last year and paid 35-40 yen per kg for the dilute sulfuric acid solution inside the batteries, which were then picked up by industrial waste dealers. The company also owns a tank for storing the sulfuric acid solution. According to the source, "They have tanks that can hold up to 1 ton, which does not require notification to the local government.

 

lead plate after dismantling batteries may flow through exports or be sold to domestic dismantling companies.

We hear that major dismantling companies in western Japan are also purchasing a considerable amount of lead from Chinese companies. This is probably because the volume of dismantling by Chinese companies is increasing. According to our source who handles lead battery scrap,

 

Reportedly, "Nearly 70% of the batteries being dismantled in Japan are Chinese. This 70% may not be surprising, given that the Chinese have created a market for miscellaneous items in the past, and have subsequently moved a greater volume of ferrous and nonferrous scrap as well as waste plastics than the Japanese domestic traders.

 

The Chinese have grown impatient, so to speak, with the cheap Japanese market for lead battery scrap, which does not respond to the LME market price and deviates from the international price. And none of them (domestic refiners) would buy their nest lead. Hence, they chose to dismantle themselves and form their own market, which has continued to the present day. This trend will not stop. The "spreading out" is also the case for those who have dealings with Chinese suppliers. Of course, they are aware of traders who illegally export aluminum scrap to Malaysia by, for example, hiding nest lead in containers, but Malaysian traders also never buy nest lead at a high price. The price is set at around 115 yen per kilogram FOB in line with the Japanese market, but they say they can probably still get a higher price.

 

So what is waiting ahead?

 

As one can easily imagine by looking back to the days when large quantities of battery scrap were once exported to South Korea, a full-scale competition for the collection of battery scrap is developing, and it is possible that a market price that does not differ from international market conditions will become the norm. Changes are already taking place at the distribution end, and there are already signs of a decline in the amount of material supplied to primary and secondary lead smelters. Although there has been no noticeable decline in distribution as some secondary refiners have been reluctant to buy battery scrap due to equipment malfunctions, battery scrap is expected to soon become increasingly scarce as primary lead refiners increase their production lines to raise crushing and processing capacity. In addition, lead ore refiners have also declared that they will increase their battery scrap input in the SDGs era, so they will want a certain amount. It will be interesting to see how the market will change in February and beyond.

 

Also, although not Chinese, some companies in the Kanto and Tokai regions (which used to be major exporters to South Korea) are operating cupola furnaces to produce small amounts of bullion. There is also a move to set up a refining facility in the Kansai region and Wakayama. No, it is thought that there are scattered companies producing bullion throughout the country, even if on a smaller scale nationwide.

 

It has been pointed out that this kind of distribution (supply chain), which has not been the main stream in the past, may one day replace the main one. Further restrictions on exports and yards? However, some say that this is a "cat and mouse game". So, will the range of procurement routes be broadened in order to return to the domestic market what has been flowing into exports?

 

The domestic lead battery scrap market, which had been in a state of flux for about four years until last summer, is now quietly undergoing a ripple effect of change.

 

 

（IRUNIVERSE　Marcin）

 

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