December 4, 2020: Lead prices have hit a one-year high, the price risk management company Mitsui Bussan Commodities reported on December 2, saying mine disruptions had led to the rise.

However, plunging imports of the metal in China meant there would be an oversupply and further rises were likely to be capped, despite sustained demand from the battery sector, the MBC said.

Lead has been the London Metal Exchange’s top performing metal since mid-October, reaching $2,100 a tonne on the back of optimism from Covid-19 vaccine development and hopes for a swift global economic recovery.

“A tsunami of batteries was discovered that had died during lockdown, particularly in North America,” said Farid Ahmed, principal analyst with Wood Mackenzie.

“Battery makers are still struggling to catch up with pent-up demand and back orders and now winter is coming, which is the seasonal ‘battery kill’ peak demand.”

But the surge is unlikely to affect overall demand, with lead expected to contract 5.2% this year and not return to 2019 levels of consumption (12.8 million tonnes) until 2022.

“Chinese imports of refined lead plunged 77% between January and October compared to the same period last year, to 20,318 tonnes,” said the MBC. “The demand drop will push the lead market to a 276,000-tonne surplus this year, according to forecasts from the International Lead and Zinc Study Group.”