SMM, February 28 news： In February 2026, China's secondary lead market was squeezed by three factors—the holiday effect, high costs, and weak demand—leading to a significant pullback in production as expected, with industry operations characterized by "weak supply and demand and profit margins under pressure." Data showed that secondary lead production in February 2026 fell as expected by 140,000 mt, plunging 40.38% MoM and dropping 2.19% YoY; secondary refined lead output decreased 45.18% MoM and declined 11.36% YoY. In terms of the causes of production cuts, the primary factors were fewer calendar days in the month combined with the impact of the Chinese New Year holiday, which led to widespread shutdowns or production cuts at mainstream secondary lead smelters across the country. Worker departures for the holiday pushed operating rates to low levels, with particularly sharp declines in core production areas such as Jiangsu and Henan due to delayed worker returns and logistics constraints. Pressure on the cost side further exacerbated the scale of production cuts: before the holiday, scrap battery prices remained high due to recyclers' reluctance to sell, pushing up secondary lead smelting costs, while lead prices continued to trend weakly during the same period, causing widespread losses among secondary lead enterprises. Theoretical comprehensive profit/loss margins for large-scale producers were in negative territory, with small and medium-sized enterprises facing even more severe losses. Weakness on the demand side created a dual suppression: downstream battery producers entered the holiday early, causing lead ingot purchase willingness to hit rock bottom, while smelters' finished product inventories continued to accumulate, further dampening production enthusiasm among enterprises and ultimately leading to a sharp contraction in secondary lead output in February. Looking ahead to March, China's secondary lead market is expected to see a clear corrective rebound, with production forecast to increase by about 70,000 mt compared to February. The core driver of this trend is the comprehensive resumption of work and production across the industry chain after the holiday. With workers returning in concentration after the Lantern Festival, secondary lead smelters will enter a period of concentrated production resumptions, and some enterprises have indicated that they can resume operating at full capacity by mid-March. Gradual recovery in downstream demand will provide solid support for the production rebound: battery producers are resuming work successively, pre-holiday accumulated lead ingot inventories are entering a digestion cycle, and purchase willingness is expected to continue improving. Meanwhile, some secondary lead enterprises need to ramp up production to fulfill long-term contract delivery obligations, further driving up operating rates. On the raw material side, the scrap battery recycling market is gradually recovering after the holiday, and smelters' raw material inventories are expected to be replenished, easing supply constraints. Although enterprises still face certain profit pressures, with the combined effects of demand recovery, order support, and inventory digestion, production enthusiasm in the secondary lead industry is expected to improve significantly. Output in March is likely to achieve a substantive rebound, and industry operations will gradually return to normal.

[SMM Analysis] New National Standard for Secondary Lead and Inclusion in Delivery on the Agenda, Market to Shift to "Primary + Secondary Dual-Track Pricing" SMM February 27: Starting March 1, 2026, the "Secondary Lead Ingot GB/T 21181-2025" (hereinafter referred to as the "new national standard") will replace the "Secondary Lead and Lead Alloy Ingot GB/T 21181-2017" (hereinafter referred to as the "old national standard") and officially come into effect.

【SMM Flash News】With the Labor Day holiday approaching, downstream battery manufacturing companies are consciously preparing raw material inventories. Although there has not yet been a significant increase in purchasing, the overall market transaction activity is expected to improve. Lead prices remain volatile, while the prices of scrap batteries continue to rise steadily. As of April 18, 2025, the theoretical profit and loss value for large-scale recycled lead enterprises is -435 yuan per ton, and for medium and small-scale recycled lead enterprises, it is -657 yuan per ton. Secondary lead smelting companies are facing considerable operational pressure, and there may be an increase in the number of companies reducing production next week.

SMM reported on March 28 that, as of March 24, the in-plant inventory of primary lead delivery brands was 5,900 mt, an increase of 900 mt compared to March 21. As April approaches, the demand for lead-acid batteries has weakened, coupled with high lead prices, leading to a decline in purchasing enthusiasm among downstream enterprises. Some companies have even temporarily delayed picking up goods under long-term contracts, increasing the resistance for primary lead enterprises to sell their products. Recently, primary lead enterprises have been undergoing both maintenance and resumption of operations, resulting in a temporary reduction in lead ingot supply, but the regional supply differences have narrowed. Meanwhile, the supply of secondary lead has increased, supplemented by imported crude lead, leading to an expansion in the discount for secondary refined lead shipments, reported at a discount of 160-50 yuan/mt ex-factory against the average price of #1 lead. The rigid demand from downstream enterprises has caused a reversal in the inventory trend of primary lead in-plant inventories.

[SMM Secondary Refined Lead Weekly Review: Discount for Recycled Lead Supplies Widens, Smelters Enter Loss Territory] SMM March 21: This week, imported lead arrived at ports, with traders offering self pick-up prices at a discount of around 200 yuan/mt against the SMM 1# lead average price. Some secondary lead smelters made small purchases, and a few downstream battery producers indicated they could accept slightly discounted imported refined lead delivered against the SMM 1# lead average price.

SMM Secondary Refined Lead Weekly Review: Discount for Recycled Lead Supplies Widened, Smelters Entered Loss Territory SMM March 21: This week, imported lead arrived at ports, with traders offering self pick-up prices at a discount of around 200 yuan/mt against the SMM 1# lead average price. Some secondary lead smelters made small purchases, and a few downstream battery producers indicated that they could receive imported refined lead at a slight discount against the SMM 1# lead average price.