LME Lead in the Doldrums During Chinese New Year Holiday, Post-Holiday Domestic Inventory Buildup May Briefly Weigh on Lead Prices [SMM Lead Morning Meeting Minutes]

Futures:

Overnight, LME lead opened at $1,964/mt, fluctuating rangebound around the daily average during the Asian session. It initially fell then rose during the European session, touching a high of $1,968.5/mt before pulling back again, exploring a low of $1,949.5/mt, and finally closed at $1,952/mt, down $14.5/mt, a decrease of 0.74%.
During the Chinese New Year holiday, LME lead showed a weak and rangebound trend, overall trading between $1,943.5/mt and $1,974/mt. As of 18:00 on February 23, it closed at $1,962.5/mt, down $9.5/mt compared to the pre-holiday (February 13) closing price.
SHFE lead was closed for the Chinese New Year holiday.

On the macro front:
Reportedly, US President Donald Trump posted on social media on February 21, stating that the "global import tariff" rate he announced the previous day on goods imported into the US would increase from 10% to 15%, "effective immediately." Global tariff changes became the main factor affecting market pricing during the holiday. US Customs stated that it would stop collecting tariffs ruled unconstitutional by the Supreme Court starting February 24. The US January CPI increased by 2.4% YoY, slowing down from expectations of 2.5%, hitting a new low since May 2025; core CPI rose 2.5% YoY, a new low since March 2021. The unexpected cooling of January inflation data added further support to market expectations for the US Fed to cut interest rates within the year. Domestically, China continued to promote large-scale equipment upgrades this year, with equipment renewal projects in multiple sectors accelerating their implementation. Currently, the new round of equipment upgrades for 2026 has been successively launched in 31 provinces (autonomous regions, municipalities) and the Xinjiang Production and Construction Corps, involving about 20 sectors including industry, electronic information, and energy conservation, carbon reduction, and environmental protection.

Spot fundamentals:

Before the Chinese New Year holiday, lead market trading gradually halted. On the last trading day before the holiday, SHFE lead showed a consolidating and pulling back trend, as traders closed positions for the holiday, and futures trading activity also declined synchronously. Suppliers largely stopped offering quotes or were already on holiday. The last batch of downstream enterprises entered the holiday state that afternoon, leaving the lead market in a state of no prices and no trading.
Inventory side: On February 23, LME lead inventory was 286,325 mt, an increase of 53,675 mt compared to the pre-holiday (February 13) level of 232,650 mt.
As of February 12, SMM lead ingot social inventory across five regions again refreshed the 5-month high.

Today's lead price forecast:

Due to varying holiday schedules for upstream and downstream enterprises during the Spring Festival, the main lead consumption end was almost entirely on holiday and shut down, while the refined lead supply end enterprises had fewer holiday shutdowns than downstream enterprises. Medium and large primary lead enterprises basically operated normally. Lead consumption was absent during the holiday period, leading to expectations of conventional inventory buildup for lead ingots after the holiday. Regarding post-holiday work resumption, lead-acid battery enterprises are expected to resume production gradually from the first to the second week after the holiday. However, as some downstream enterprises still had leftover lead ingot stockpiles from before the holiday, procurement expectations are limited for the first week after the holiday. Although secondary lead enterprises' production resumption plans are mostly scheduled for the second week after the holiday, primary lead smelters maintained relatively normal production. In-factory inventory accumulated during the Spring Festival holiday is expected to be gradually shipped under long-term contracts or transferred to social warehouses after the holiday. The expectation of lead ingot inventory buildup is also likely to be a main factor putting pressure on lead prices in the initial period after the holiday. As downstream lead enterprises resume work and lead consumption recovers normally, lead prices may see opportunities for fluctuating rebounds.

Data source statement: Except for public information, other data are processed by SMM based on public information, market communication, and relying on SMM's internal database model, for reference only and do not constitute decision-making advice.