LME Outperforms SHFE in Lead Futures; Overnight SHFE Lead Opened Lower With a Gap [SMM Lead Morning Update]

SMM News on August 18:

Overnight, the LME lead 3M contract opened at $1,885.5/mt. After the open, it drifted higher, hitting an early-session high of $1,891.0/mt. It then stayed high and moved sideways within a narrow range, dipping to a low of $1,885.0/mt, and finally closed at $1,885/mt, up $5.5/mt from the previous trading day, a gain of 0.29%. The trading range was $1,885.0-1,891.0/mt, with a fluctuation of $6.0/mt.

Overnight, the SHFE lead 2610 contract opened today at 15,880 yuan/mt. After the open, it quickly fell to 15,845 yuan/mt and then rebounded to 15,938 yuan/mt. After moving sideways within a narrow range, it moved sideways in late trading within 15,865 yuan/mt-15,880 yuan/mt, and finally closed at 15,875 yuan/mt, down 75 yuan/mt from the previous trading day’s closing price, a decline of 0.47%.

Demand side, as downstream enterprises ended their high-temperature holidays, some enterprises resumed normal production, and routine procurement demand rebounded, easing to some extent the pressure from inventory buildup of lead ingots after delivery. Supply side saw both increases and decreases: maintenance at primary lead enterprises will bring some reduction in supply, and with smelters holding prices firm while selling, the widening of spot lead discounts was limited; as losses at secondary lead enterprises were somewhat repaired, some enterprises resumed production, increasing market circulating supply, and secondary refined lead maintained trading at relatively larger discounts. Overall, lead prices maintained a fluctuating trend.