Environmental cuts, pre-holiday purchases expand declines in lead social stocks 

SHANGHAI, Sep 20 (SMM) – Declines in social inventories of refined lead in China speeded up this week as a steep fall in lead prices encouraged downstream stockpiling for the week-long National Day holiday.

Unexpected environmental curbs in Anhui province deterred production at local secondary smelters from the middle of this week. This, together with maintenance at some primary smelters in Liaoning and Yunnan provinces, further tightened up supply and reduced stocks across social warehouses.

SMM data showed that lead social stocks across Shanghai, Guangdong, Zhejiang, Jiangsu and Tianjin decreased for the seventh consecutive week, 4,000 mt lower from a week ago and stood at 23,400 mt as of Friday September 20. The decline expanded from a drop of 2,300 mt in the previous week.

SMM expects social inventories of refined lead to extend declines next week on continued stockpiling by downstream lead-acid battery mills as they planned for shorter breaks. The ongoing environmental cuts on secondary lead production and potential new cutbacks to come could also weigh on inventories.