"The bearishness that has settled in the contract is likely to continue this year," said Vandana Bharti, senior research analyst, SMC Comtrade.
Lead prices on the London Metal Exchange (LME) touched a record high of $3,900 a tonne on October 10, 2007 (about Rs 1,66,920) but have been slipping since then.
"Fund buying and speculative interest took the prices to a higher level, but the absence of both is weakening the metal now," said Surendra M Mardia, president of Bombay Metal Exchange.
Lead futures on the LME have declined over 22 per cent since last month mainly due to the lack of consumer demand, analysts said.
They feel that as lead prices continue their downslide, buying at lower levels can emerge in the later part of the year, and thus bring temporary respite from the steady slide.
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"Current lack of demand is because this is a seasonally lean period," said Renisha Chainani of Ahmedabad-based Anagram Commodities.
She said demand for lead will emerge from September onwards as winter season approaches in India and China.
"Fourth quarter every year generally sees a flurry of demand for base metals, mainly from the lead battery makers," SMC's Bharti said.
Around 70 per cent of total lead produced in the world finds place in lead acid batteries mainly used in the automobile industry.
Demand for lead is slackening, as growth and industry activity in the US - largest producer of the metal - is sluggish.
Even buyers in China, another major lead market, have adopted a wait-and-watch approach as they expect prices to correct further, Bharti said.
Chinese lead imports are declining due to rising domestic production. China accounts for 30-35 per cent lead consumption.
Lead production in China is expected to rise 4.3 per cent this year leading to a surplus in the country's domestic market, according to the International Lead and Zinc Study Group.
"According to ILZSG, world's lead production will be up 8.4 per cent this year and the global market is likely to be in a surplus of 26,000 tonnes as against a deficit of 10,000 tonnes last year," Chainani said.
Traders and analysts feel that lead prices on LME will first decline to as low as $1,500 a tonne and will later recover to a maximum of $2,000 a tonne.
"With prices at lower levels, smelters will close and therefore prices will recover due to a possible supply crunch," Chainani said.
On LME, lead is seen touching $1,500 a tn in two months, while on MCX it is likely to move as low as 70 rupees a kg, she said.
BME's Mardia, however, expect zinc and lead to trade near $2,000 a tonne Levels by the end of this year.
"Lead is a by-product obtained while mining zinc, their prices therefore move in tandem," he said.