China "e" bikes silently drive lead demand

As the red light changes, Han Zhang turns the handlebar of his
battery-driven bike, pushes off with his foot, and whirrs silently along a
Beijing boulevard.

His yellow bike looks like something between a bicycle and a
scooter, but to the lead industry, hes driving a car. Every year, millions of
Chinese are hitting the streets on "e" bikes, battery-powered
contraptions that are increasingly popular as soaring fuel prices make
traditional motorbikes and scooters expensive to drive.

The bikes are getting bigger, faster and more glamorousand
the growing size of their batteries is soaking up increasing amounts of lead,
reports Reuters.

"Everyone looks at the "e" bike as a replacement
for a motorbike. But, for the lead industry, its an astonishing change. In
terms of lead demand, one "e" bike is one car," says Mark
Stevenson, technical manager for lead at Nyrstar in Australia. "If someone
says there is growth of a million bikes a year, the lead industry thinks who
cares. But, if you say a growth of a million cars per year, that changes the
whole picture."

Yet a 48-volt bike battery uses just under 10 kg of lead,
similar to that used by a medium-sized car like a Toyota Camry. They last for
about a year, compared with over three years for a typical car battery.

"Theres a huge amount of lead being carried around on
bikes in China," says Huw Roberts of CHR Metals. He estimates that the
bikes produced through the end of last year have absorbed about 400,000 tons of
lead. That new source of demand could help drive up lead prices, which hit a
record high of $3,835 a ton on October 9.

The standards for newer, 48-volt bikes could be along the lines
of those for the more common 36-volt bikes, limiting speed and size and setting
guidelines for which companies can produce them to weed out cut-throat
competition.

Estimates on how many companies produce "e" bikes vary
from 100 to 300 firms, but everyone agrees that their low design and start-up
costs have driven margins to the bare minimum, eroding profits for more
established firms like Shanghai Forever.

Meanwhile, 72-volt bikes that are as big and powerful as
motorcycles are alarming city governments. They have been banned in the southern
boom cities of Guangzhou, Shenzhen, and Zhuhai.