Sanders to base prices on lead scrap
Jul 23, 2012 | 03:20 PM
| Daniel Fitzgerald
Tags
Sanders Lead,
lead-acid battery prices,
lead scrap,
LME,
primary lead,
Roy Bray,
Daniel Fitzgerald
NEW YORK — Sanders Lead Co. Inc. is moving its refined lead sales pricing to a model based on the cost of lead scrap to reflect the increasing cost of lead-acid automotive batteries.
With lead batteries trading upward of 45 cents per pound, it has become difficult for the company, which previously used London Metal Exchange prices as a basis, to make a margin on sales, Sanders vice president Roy Bray told AMM.
"Our basis is now what the cost of scrap is, plus the smelter charge," Bray said.
"The rule of thumb is it takes two loads of junk batteries to make a load of lead. If you’re buying batteries at 45 cents per pound and you double that, it means your metal is costing 90 cents per pound," he said. "So we’re paying 90 cents per pound for scrap material and the LME is at 86 cents per pound. And we were selling on an LME-based price plus a 5.5-cent-per-pound premium to cover the smelting cost."....
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