Futures:
Overnight, LME lead opened at $1,956.5/mt, trended weakly in early trading and briefly dipped below $1,950/mt, before Middle East peace talks progressed positively, leading LME lead to gradually stop falling and rebound, fluctuating upward throughout the day to finally settle at $1,965/mt, up 0.77%.
Overnight, the most-traded SHFE lead 2608 contract opened at 16,395 yuan/mt. Post-holiday lead ingot inventory buildup and smelter maintenance coexisted, with the market intertwined with bullish and bearish factors, causing SHFE lead to stop falling and then consolidate, trading mostly in the range of 16,375-16,415 yuan/mt, before finally settling at 16,430 yuan/mt, up 0.34%. Its open interest rose to 73,511 lots, up 3,981 lots from the previous trading day.
On the Macro Front:
On Monday, the first round of high-level talks between the US and Iran concluded. The joint statement issued by Qatar and Pakistan showed that the parties agreed on a roadmap, aiming to reach a final agreement within 60 days, establishing a technical negotiation mechanism and a communication hotline, and setting up a "conflict de-escalation group." The US temporarily relaxed restrictions on Iranian oil transactions for 60 days. Vance said Iran agreed to allow IAEA inspectors into Iran. Trump stated Iran will agree to inspections of major weapons to ensure long-term maintenance of "nuclear integrity." Iran stated the talks did not involve nuclear issues and no new commitments were made. Separately, UK Prime Minister Starmer announced his resignation, marking the seventh prime minister in a decade. The Labour Party will launch candidate nominations in July, with a new party leader expected to be elected by September.
:
Yesterday in the lead spot market, after the holiday, SHFE lead reversed its trend and pulled back. In the Jiangsu, Zhejiang, Shanghai market, circulating cargoes were limited, with some quotations remaining firm and unchanged from before the holiday. Quotations for EXW cargoes from primary lead smelters diverged, with mainstream production quotations against the SMM #1 lead average price ranging from a discount of 30 yuan/mt to a premium of 80 yuan/mt ex-works. On the secondary lead side, smelters sold as they produced, but some showed strong holding-back sentiment. Secondary refined lead quotations were around parity with SMM #1 lead ex-works, with ex-tax prices on the low side. After the holiday, downstream enterprises gradually resumed production, but the wait-and-see sentiment was strong, with some mainly purchasing through long-term contracts, low inquiry enthusiasm, and sluggish spot order market trading.
Inventory: As of June 22, LME lead inventory stood at 301,850 mt, down 100 mt from the previous trading day. Total SHFE lead warrant inventory was 62,755 mt, down 25 mt. Total SMM lead ingot social inventory across five regions was 68,800 mt, up 2,300 mt from last Thursday.
Lead Price Forecast Today:
After the Dragon Boat Festival holiday, lead ingot social inventory increased as expected, putting lead prices under pressure. Currently, it is the mid-year period, and upstream and downstream enterprises are also facing the need to recoup funds and close accounts for stocktaking. After the holiday, actual procurement by downstream enterprises has not significantly recovered, and it is expected that destocking of lead ingot social inventory will be difficult in the short term. Meanwhile, from June to July, some primary lead enters maintenance, while secondary lead sees delayed production resumptions due to losses and raw material undersupply, relatively tightening the supply side. Under the combined effect, it is expected that the decline in lead prices will slow down, showing a consolidation trend.
Data source statement: Except for publicly available information, all other data are processed by SMM based on public information, market communication, and SMM's internal database model, for reference only and do not constitute decision-making advice.
![Macro Situation Improves, Lead Prices in and outside China Stop Falling and Rebound [SMM Lead Morning Report]](https://imgqn.smm.cn/usercenter/xVUpr20251217171722.jpg)
![This week, primary and secondary smelter maintenance increased, and the weak supply-demand pattern persisted [Lead Futures Brief Review]](https://imgqn.smm.cn/usercenter/XMxKT20251217171720.jpeg)
