Neil Hawkes, Principal Analyst from CRU, joins ELBC’s speaker blog series discussing shortand long-term market drivers for lead metal in response to global shocks.
July 8, 2022
With the end of the ICE (internal combustion engine) age in sight, amid vehicle electrification and a wider energy storage move away from fossil fuels towards renewable power,the resilience of the lead-based battery sector is the key factor that will determine lead’s price path in the years ahead.
World events including the war in Ukraine have fuelled inflation and the spring Covid-19 lockdowns in China have turned investor sentiment around from worrying about upside supply risks to downside demand risks. And recession risks have certainly grown.
LME lead price recovery from the depths of the first wave of the Covid-19 pandemic had been impressive, with broader ‘macro’ economic recovery and pent-up demand lifting all commodity prices. However, lead values have recently fallen, part of a wider metals retreat as economic slowdown concerns grow.
As lead supplies have been struggling to keep up with strong demand rebound in North America and Europe, my presentation at ELBC will delve into Chinese-led Asian supplies coming to the rescue.
Chinese lead exports in the 2020s are up from a 2010s trickle, if still way below the 2000s flood. Korean, Kazakh, Indian and Australian metal flows also key.
Looking beyond the ‘macro’ market turmoil of recent years, last year’s COP26 gathering in Glasgow provided a timely reminder of the longer-term climate change political priorities, injecting fresh urgency to the ‘greening’ of the global economy. This is a key opportunity for lead’s major customer – the battery industry.
Join my presentation at ELBC to hear more about the importance of the lead-based battery sector for lead metal demand and its impact on the lead price path in the years ahead.
I believe that lead will play a role in a ‘greener’, more sustainable world. The only uncertainty is how big or small that role will ultimately prove to be. I’ll give you CRU’s assessment in Lyon in September. I look forward to seeing you there.