(Updates lead prices in fifth paragraph.)
Nov. 1 (Bloomberg) -- China’s lead market, the world’s largest, is poised to swing into a deficit in 2014 for the first time in five years as production of lead-acid batteries boosts demand, according to Beijing Antaike Information Development Co.
The deficit will be 13,000 metric tons, said Feng Juncong, a senior analyst with the state-backed researcher who’s been studying the market for almost 30 years.
A global glut is easing as smelters shut just as sales of cars, whose batteries are the single biggest source of demand, expand to a record. Dozens of smelters in China have idled plants as part of government efforts to curb pollution and as prices in London tumbled 11 percent since Feb. 5.
Lead on the Shanghai Futures Exchange may reach 15,300 yuan ($2,508) as demand from battery production is seen to grow by 5 percent to 6 percent to about 5.02 million tons, Feng said at a conference in Beijing today.
The metal closed at 14,425 yuan per ton on the bourse in China and traded at $2,205.50 a ton on the London Metal Exchange at 5:15 p.m. Shanghai time.
Refined lead consumption in China will grow 6.3 percent to 5.26 million tons next year, while production may rise 5 percent to 5.25 million tons, Feng said.
China’s consumption of zinc, used to galvanize steel, will grow about 5 percent as Premier Li Keqiang’s vow to meet major economic goals this year will lead to stable growth in infrastructure and construction, Feng added.
The country’s smelters will import more than 800,000 tons of zinc concentrates next year, encouraged by relatively high treatment charges, Feng said.
Refined zinc production in China is forecast to rise 5.8 percent to about 5.5 million tons, while consumption will probably rise to about 5.93 million tons, Feng said.
--Alfred Cang and William Bi. Editor: Brett Miller