Futures:
Overnight, LME lead opened at $1,880/mt, drifting higher during the Asian session. Entering the European session, it tested a high of $1,890/mt before weakening as bears added positions, giving back all gains to dip to $1,867/mt, and finally closing at $1,868/mt, down 0.48%.
Overnight, the most-traded SHFE lead 2609 contract opened lower with a gap at 15,820 yuan/mt, dipped slightly to a high of 15,880 yuan/mt before drifting lower, with bears adding positions to push SHFE lead down to 15,700 yuan/mt, and finally closed at 15,715 yuan/mt, down 1.07%.
On the macro front:
Trump: Iran wants to meet but we are not interested; will strike the Harzand region in Iran (where nuclear facilities are reportedly located) very hard; if the Houthis blockade the Red Sea, the US will "take action". Iran's military struck a US airbase in Bahrain, saying that if the US attacks Iran's nuclear facilities, all US and allied interests in the region will become targets. The 10% temporary tariff is about to expire, US Trade Representative previews new tariffs will soon fill in; according to the UK Financial Times: Trump is about to impose new tariffs on dozens of countries as soon as this week. China's MIIT lithium battery and similar products standard working group: will hold discussions on 10 industry standards for solid-state lithium batteries. The A-share STAR 50 Index surged over 10%, hitting a new high for the year in its biggest single-day gain.
Spot Fundamentals:
SHFE lead continued to move sideways, with suppliers selling as needed, though there were few quotations in the Jiangsu, Zhejiang, Shanghai region. Additionally, EXW cargoes from primary lead smelters were ample and generally quoted at discounts, with mainstream production areas offering at discounts of 50-0 yuan/mt against the SMM #1 lead average price. For secondary lead, smelters showed modest enthusiasm for shipments, with limited circulating supply in the market; some secondary refined lead quotations were at discounts of 50-0 yuan/mt against SMM #1 lead. Downstream enterprises remained cautiously on the sidelines, digesting inventories during production, with some waiting for new monthly long-term contract execution and only a small amount of just-in-time procurement, leading to sluggish market transactions.
Inventory: On July 21, LME lead inventory decreased by 2,025 mt to 449,750 mt; as of July 20, total social inventory of SMM lead ingots across five regions fell by 8,000 mt MoM from July 16.
Today's Lead Price Forecast:
Demand side, the lead-acid battery market remained in its consumption off-season, with downstream enterprises maintaining purchases as needed; as some enterprises have holiday expectations, lead ingot purchasing strength is expected to weaken further. Supply side, secondary lead enterprises maintained low operating rates with limited supply circulating in the market, while primary lead supply was relatively ample; spot market transactions are expected to remain skewed towards discounts. In addition, the high uncertainty of the Middle East conflict has driven up energy and shipping costs, which has become one of the factors affecting lead prices.
![Overnight, bears increased positions, leading lead futures to close lower; macro sentiment remains one of the factors affecting lead prices [SMM Lead Morning Brief]](https://imgqn.smm.cn/usercenter/hrxHx20251217171721.jpeg)
![In the near term, SHFE lead will move sideways, while China focuses on secondary lead production resumptions and changes in downstream operating rates. [Lead Futures Brief Comment]](https://imgqn.smm.cn/usercenter/qnyHQ20251217171721.jpeg)
