SHFE lead weakened independently, plunging 1.80% to approach the 16,000 mark [SMM Lead Morning Update]

SMM, September 1:

Overnight, LME lead opened at $1,892/mt, consolidating with wild swings during Asian trading hours. Entering the European session, it touched a high of $1,910/mt, but gave back all gains near the close as bears added positions, dipping to a low of $1,886/mt before finally settling at $1,887/mt, down 0.32%.

Overnight, the most-traded SHFE lead 2609 contract opened at a high of 15,910 yuan/mt, then drifted lower as bulls reduced positions, dipping to a low of 15,755 yuan/mt near the close before finally settling at 15,765 yuan/mt, down 0.88%.

As late July approached, the July lead ingot long-term contracts were about to expire. Medium and large downstream enterprises were waiting for the new monthly long-term contracts to take effect, reducing their purchasing enthusiasm for lead ingots. Meanwhile, some downstream enterprises planned to suspend production for holidays due to high temperatures, further dampening lead ingot procurement demand. Next week, primary lead enterprises in central China are about to enter maintenance, while new secondary lead capacity in east China is ramping up trial production, with both supply-side increases and decreases present. If lead consumption remains sluggish, the destocking of lead ingot social inventory will be difficult to sustain, and the possibility of renewed inventory buildup dragging on lead price trends cannot be ruled out.