Lead ingots social inventories rose further amid limited downstream work resumption

SHANGHAI, Feb 26 (SMM) – Social inventories of lead ingots across Shanghai, Guangdong, Zhejiang, Jiangsu and Tianjin gained 3,300 mt from February 18 and rose 2,100 mt from February 22 to 46,700 mt as of Friday February 26, an SMM survey showed.

Most lead-acid battery companies have resumed work this week, but lead prices have risen significantly over 16,000 yuan/mt, and downstream companies are reluctant to make purchases at high prices. At the same time, the current price gap between spots and futures has widened, prompting some spot producers to deliver the goods to warehouses, leading to the increase of lead ingot social inventories.

The inventories at primary lead smelters will remain high next week, and the spot delivery by holders will mainly contribute to the social inventory increases. In March, lead-acid battery companies will basically complete the resumption of work, and the operating rates will gradually increase. During this period, environmental regulations in Guizhou are likely to cause the gap between lead supply and demand, and the lead ingot inventory accumulation may slow down.