Lead batteries set to power stellar lead demand in India, says CRU’s Morris

Lead batteries set to power stellar lead demand in India, says CRU’s Morris

Lead batteries set to power stellar lead demand in India, says CRU’s Morris 163 168 Batteries International

November 1, 2023: “All bets are on India” to be the primary driver of growth in demand for lead in the next few years, according to the head of research consultancy CRU’s base metals division, Simon Morris.

Morris (pictured) told the LME Metals Seminar in London on October 9 India’s stellar performance is expected on the back of buoyant economic growth, with increasing numbers of vehicles on the roads in the populous country.  

CRU analysis shows demand in India will grow by around 5% annually to account for over half of lead demand growth in Asia excluding China, more than 30% of lead demand in Asia including China and in excess of 20% of global lead demand growth.

India’s government is pushing green mobility with EVs, but the reality is that ICE/HEVs will drive most of the vehicle growth through this decade — almost all are using lead batteries for starter/auxiliary functions, according to CRU.

Additional lead battery demand in India is also to continue from backup power energy storage units in middle-to-high income homes and smaller businesses.

Meanwhile, major growth in Chinese secondary lead supply is forecast to continue at pace — with 60% of secondary supply growth over the year ahead coming from China and rest of Asia, Morris said.

In Europe, where energy costs account for around 50% of operating expenses of the region’s smelters, Morris said geopolitical instability and oil price volatility could bring further pressure to bear on costs.

“We are seeing a weak demand story in Europe and power is going to be a major question in terms of smelting capacity going into 2024.”

The global energy transition will fuel price volatility in battery-related metals but not through zinc or lead, Morris said.

“Lead is not a great story but it’s a stable one. Given a lot of the emotion that sits alongside the tumult of the energy transition, I think we’d call lead a bit of a balm to that.”

There is downside risk if the EV story gathers pace but, at the moment, lead does not play a major part in terms of EVs, Morris said.

“However, if we can position lead as having a bigger role to play in the fixed energy storage facilities sector then that gives us a bit of upside.”