SMELTER PROBLEM: GETTING THE LEAD IN

SMELTER PROBLEM: GETTING THE LEAD IN

A number of U.S. lead smelters that have been running below capacity this year will return to full output by August, as warmer than normal climate patterns increase the supply of batteries for recycling, said Tom Parker, manager of metal purchases for Exide Inc.

But he said Exide is operating at capacity. The company expects to produce 320,000 short tons of lead in 1998, about 20,000 tons more than 1997, he said.He spoke during the International Lead and Zinc Study Group's seventh annual International Recycling Conference here.

Mr. Parker said he knew of at least four U.S. smelters running at 15 percent to 20 percent below capacity. They are located all across the country in regions that include the West Coast, the eastern United States and the Southwest, he said.

Batteries are major consumers of lead and are later recycled as scrap at secondary smelters.

''Certain U.S. smelters have not been able to get enough raw material, so they have been producing below capacity since the beginning of the year,'' Mr. Parker said.

''But we're already seeing a warmer than normal climate pattern starting, and we're seeing the recycling rate picking up,'' he said.

''Once you get into the hot summer in late June through July, that's when you will really start to turn this thing and you'll see the smelters coming back in August,'' he said.

Mr. Parker said full capacity should be maintained until at least December.

Mr. Parker would not forecast whether production could hold at capacity levels beyond 1998. He said that would depend on what the winter is like, as severe cold would start the year off with a very high degree of recycling.

Exide, which obtains 75 percent of its feed from its own sources, has not had difficulties maintaining capacity levels this year. A four-week strike at an Exide U.S. smelter earlier this year enabled the company to collect enough scrap to be spread among its other smelters to ensure there was enough feed, he said.

Also, the company is planning smelter maintenance shutdowns in June and July, during which time scrap material will continue to come in.

''The recycling rate for the rest of this year will be more than ample to keep us at capacity,'' he said.

His company's 1998 estimated production of 320,000 short tons will be about 20,000 tons more than in 1997, he said. Mr. Parker noted that much of the extra production will come from a smelter the company acquired three or four months ago. The remainder of the additional production will come from better efficiencies at the smelters, he said.

Mr. Parker said there is the potential for 97.9 million units in battery shipments in 1998 in the United States, although 11 million of these is targeted for exports.

Despite the better availability of scrap in the second half of this year, Mr. Parker said some smaller producers are at risk for closure because of tight margins between costs and selling prices.

One smelter particularly at risk is the Gulf Coast plant in Florida, he maintained, which currently is dealing with environmental problems and is supplied by only one battery company.

''I think it's a very vulnerable operation,'' he said. The plant produces about 15,000 tons of lead, Mr. Parker said.