Commodities

Lead battery market poised for a boom

G Chandrashekhar December 17 | Updated on December 18, 2019 Published on December 17, 2019

Green recycling need of the hour

India is likely to witness a substantial growth in the demand for lead batteries given that several sectors, including automotives, telecommunication, railways and defence, are set to expand in the years ahead. As a battery ingredient, lead is increasingly used in inverters, UPS and similar energy storage devices.

Huge opportunities for battery demand growth make the outlook for lead metal positive, according to several expert speakers at the recently concluded international conference on ‘Lead and Lead Batteries: Energy Storage, E-Mobility and Environment’, organised by the India Lead and Zinc Development Association. Over 175 delegates from India and abroad participated.

The conference discussed the unfolding new markets for lead batteries, covering electric-rickshaws and two-wheelers, and similar e-mobility devices. The Indian battery industry is gearing up to meet the growing domestic demand in terms of booth quantity and quality, it was highlighted.

While demand conditions are positive, there is a need for more R&D to infuse new technologies for improved battery life and performance, even while adopting cost-saving measures for the benefit of consumers. The responsibility, therefore, rests on lead producers, lead battery manufacturers and recyclers, as also the research community.

The environmental aspects of the lead sector have become a matter of concern. There is increased informal, or backyard, lead recycling from used batteries. For the battery manufacturers, relevant environmental legislation is in place through the Ministry of Environment and also enforcement agencies such as Central and State Pollution Control Boards.

However, there is hardly any monitoring of dealers and backyard recyclers. The CPCB and SPCBs should tighten vigil and monitoring. The registration of battery dealers will help as it will help prevent diversion to unauthorised units. Collection and disposal of used lead batteries should become more transparent. It will result in increased lead recovery in an eco-friendly manner through conscientious recyclers.

Green recycling

What we need in this country is total green lead recycling. In lead consumption, India is poised to buck the global trend as auto sales around the world are anticipated to remain weak in 2020. In some sense, the global auto sector is on life-support system, and, after all, four-fifth of lead demand comes from automotive batteries, as the World Bank pointed out in a recent report.

On the other hand, rising stop-start vehicle production is seen offsetting the loss of demand from falling conventional vehicle sales. So, the big question for 2020 is whether lead consumption will exceed production. At the moment, the market is projected to be in surplus, but in reality, the supply-demand balance for 2020 looks tight. This should normally attract speculative capital.

Any unplanned outages at smelters can tighten the market. Additionally, if the trade friction between the US and China were to cool, the base metals complex will get a lift, and lead may be an unintended beneficiary.

The writer is a policy commentator and a commodities market specialist

Published on December 17, 2019
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