IBDA Forecasts Battery Price Increases

The Independent Battery Distributors Association is warning members to expect further increases in battery prices due to significant rises in material costs. Battery manufacturers have been adversely affected over the last few years by dramatic increases in the price of lead due to growing worldwide demand, particularly in Eastern Europe, China and India.

Warning of inevitable increases Godfrey Ferris, IBDA Secretary, explains: “Lead prices did fall earlier this year but are again on the rise and it is expected that this trend will persist. Whilst the current cost of $2,000per ton is still short of the $3,000 reached earlier this year, other factors have arisen that far outweigh this temporary respite.

“Manufacturers now face not only the predicted lead prices increases (and lead accounts for over 70 per cent of battery manufacturing costs) but also an escalation in the prices of battery acid and oil, which in turn results in more expensive Polypropylene used for battery cases.”

Indeed, since January this year, acid has increased from $242/ton to $725, whilst during the same period the cost of Polypropylene has risen from $1,300/ton to $1,900.

Add to this increased costs of freight, local transport and the deterioration of Sterling against the Euro and other currencies, then it is clear that Battery manufacturers will be unable to stabilise their prices within the foreseeable future .

To Stock Or Not To Stock?

IBDA’S advice is to purchase stock now. Whilst manufacturers have absorbed some of the earlier increases, this cannot continue. Stocking now will mean avoiding inevitable increases whilst capitalising on higher scrap values now available by returning old batteries legally and safely through your battery supplier.

With soaring costs it can be tempting to look to the East to benefit from cheaper labour costs and less stringent health and safety regulations.
Whilst it is acknowledged that China has some first class manufacturing plants producing excellent products, there are many more that have a
deplorable lack of investment in automation, tools and quality control standards, which result in an unreliable if not dangerous product. Buying batteries from an unverified source in the Far East is not a sensible option, says the IBDA.