Secondary lead finished product inventories decline WoW, off-season limits destocking degree [SMM Secondary Lead Inventory Weekly Review]

SMM, August 7:

As of August 6, secondary lead finished product inventories stood at 27,600 mt, down 6,700 mt MoM. This week, lead prices dipped before rebounding. Downstream users took advantage of low prices for essential restocking, and coupled with ongoing production cuts at smelters and lower operating rates, tightening supply drove destocking of smelters' inventories. Battery consumption remained in the off-season. Downstream saw no large-scale stockpiling, with most purchases made as needed, and transactions were mild.

Looking ahead to next week, secondary lead production cuts are expected to continue, and tightening spot supply will continue to support destocking. However, end-use demand remains weak, and lead price rebound lacks momentum. Primary lead's cost advantage continues to divert demand, making a significant improvement in downstream purchases unlikely. Smelter inventories are expected to keep drawing down but at a limited pace, and the market is likely to consolidate on a subdued note. Focus on the implementation of smelter production cuts and end-user rigid demand.