Secondary refined lead spot orders tight with firm quotes; raw material issues unresolved, limiting smelter profits [SMM Secondary Refined Lead Weekly Review]

SMM, September 18:

This week, SHFE lead rallied, and spot orders for secondary refined lead were tight with firm quotes. Mainstream transactions narrowed to a discount of 50 yuan/mt against the SMM #1 lead average price, with some cargoes briefly on par with it, mainly supported by smelter production cuts, tight spot orders, and pre-holiday restocking demand. On the profit side, losses in secondary lead smelting narrowed notably but remained under pressure. Scrap battery raw material costs are still expected to rise, and with higher energy costs, most small and medium-sized smelters remain loss-making. Looking ahead to next week, stockpiling for the dual holidays is nearing its end, downstream purchases may slow down, and imported cargoes continue to weigh on the market, so the discount on secondary refined lead may widen slightly. High raw material prices remain difficult to resolve, limiting upside for lead prices, with little visible improvement in smelting margins.