To the relief of smelters, Cannington's shutdown in December was short lived (just two days). The immediate move by smelters to enquire about securing spot tonnages is additional evidence of the tightness in the market for lead concentrate. Availability was then poor in any case, and the fact that no business stemmed from the enquiries may well be just as much testament to the prevailing tightness as to the added tightness that would have been created if Cannington's shutdown had been protracted. However, additional disruptions to supply have never been far away. Another mine, Perilya's Broken Hill, suffered a fatality on 10~(th) January, although we believe operations have now resumed. Meanwhile, Lundin is having to reschedule deliveries from Galmoy because delays in negotiating a new labour contract have resulted in a fall in labour productivity. We understand that spot tonnages are even more difficult to secure, particularly if one is unwilling to accept TCs of around 40 dollars/t flat (for a clean material), which is the going rate in China. China's smelters are better placed to accept such terms at the moment because the country's domestic metal price is at a significant premium to that elsewhere. Moreover, Chinese smelters are faced with the uncertainty surrounding proposed moves aimed at reducing the size of their industry. The prospect of a restriction on lead concentrate imports may be encouraging a short-term flurry of demand.
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