Beijing began to impose 10% of export tax on refined lead after June 1, 2007. The policy change significantly drew Chinese refined lead exports down in H2 2007. The lead exports remained weak in the first quarter this year.

China is an important refined lead supplier on global market. Though the lead supply tightness around the world eased somewhat in 2007, the supply shortage on west spot market remained unchanged during the year on the sharply dropping Chinese lead exports and the low lead inventory on LME. Moreover, the heaviest snow in South China influenced Chinese refined lead output.

Global economic outlook is still not clear while the oil and gold prices are growing rapidly. In this case, institutional investors tended to invest in resources commodities markets in order to reduce risks. Therefore, base metals prices saw a growth at the beginning of 2008 both on overseas and domestic markets.

Lead smelters in Gejiu City of Yunnan Province suspended crude lead production since December 2007. The reason was that the local government raised the tax of lead production to 17% from 7% in Dec. 2007. The city¡¯s refined lead production was affected a lot too.

Chinese Government expressed in December 2007 that the export tax of refined lead would stay at 10% in 2008.

Chinese secondary lead capacity and output was growing rapidly in Q1 2008. According to CNIA¡¯s statistics, China produced 81,485 tonnes of secondary lead in Jan.-Feb. 2008, growing by 10.65% comparing with the same period of last year.

China produced 2.75 million tonnes of refined lead in 2007, according to CNIA. Antike estimates Chinese lead output will increase to 3.05 million tonnes in 2008. Besides, the net exports of Chinese lead will be 250,000 tonnes, comparing with 210,000 tonnes in 2007. Therefore domestic apparent consumption will rise to 2.80 million tonnes in 2008 from 2.54 million tonnes in the preceding year.

Chinese lead production was struck by the blizzard in January and early February 2008 that encouraged domestic lead price in the first two months of this year. But along with lead production resumed in March, Chinese lead price fell down again. Antaike thinks domestic demand for lead is a little bit weaker than the supply at present. But the consumption of lead acid batteries may awake in the next several months, and Chinese lead price will still have chance to rise again.

Executive Summary
Macroeconomic Outlook
Chinese Lead Prices
Chinese Lead Material Supplies
Chinese Refined Lead Production
Import and Export of Lead
Consumption
Market Balance and Price Outlook

Tables
Table 1: Prosperous index of the macroeconomics
Table 2: Investment in Fixed Assets by Industry (2008.01-02)
Table 3: Refined lead prices on LME and Chinese spot markets in 2006-Q1 2008
Table 4: Treatment charge for homemade and imported Lead concentrate in 2007-Q1 2008
Table 5: Chinese lead and zinc mine¡¯s expansion capacity for 2008,
Table 6: Chinese lead-in-concentrate output by provinces in Jan.-Feb. 2008
Table 7: Import of lead concentrate into China by origin in Jan.-Feb. 2008
Table 8: Chinese additional lead refining capacity for 2008-2010
Table 9: Chinese refined lead capacity by provinces or regions in 2005-2008
Table 10: Chinese refined lead output by province in Jan.-Feb. 2008
Table 11: Chinese refined lead output by province in 2006-2008
Table 12: Chinese lead producers with capacity above 50kt in 2006-2008
Table 13: Imports and Exports of Chinese Lead Products in January - February 2008
Table 14: Chinese autos and motorcycles output and sales volume in Jan.-Feb. 2008
Table 15: Chinese lead acid battery imports and exports in Jan.-Feb, 2008
Table 16: Chinese lead market balance on quarterly basis in 2007-2008
Table 17: Chinese lead market balance in 2004-2008

Charts
Chart 1: Refined lead prices on LME and Chinese spot market
Chart 2: Chinese lead-in-concentrate price and refined zinc price index in Jun. 2003-Mar. 2008
Chart 3: Monthly Chinese lead-in-concentrate output and yearly growth rate of the production in 2007-2008
Chart 4: Monthly import of lead concentrate into China in 2006-2008
Chart 5: Chinese lead refining capacity in China in 2001-2008
Chart 6: Chinese lead spot price and export price in Jan.-Mar. 2008
Chart 7: Monthly import and export of refined lead in 2007-2008
Chart 8: Chinese lead consumption structure in 2007
Chart 9: Chinese lead acid batteries consumption structure in 2007

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