Summary of SMM Lead Morning Meeting on July 14, 2023

Futures trading:

Overnight, LME Lead opened at $2091 per ton, stabilizing sideways during the Asian session, with a low of $2089.5 per ton during the period; After entering the European period, due to the unexpected decline in the US PPI in June, the US dollar continued to decline, and the pressure on lead metal was released to reach as high as $2130/ton. In the end of the day, it slightly declined and ended at $2117.5/ton, up 1.07%. Its holdings decreased by 857 to 118000 compared to the previous trading day, and trading volume increased by 86 to 5220.

Overnight, the main contract of Shanghai Lead 2308 was opened at a high of 15655 yuan/ton, hitting a low of 15635 yuan/ton at the beginning of the session. Encouraged by the upward trend of Lun Lead, it reached 15820 yuan/ton and finally closed at 15775 yuan/ton, an increase of 0.96%. Its holdings decreased by 148 to 91539 compared to the previous trading day, and trading volume decreased by 22532 to 36611.

Today's lead price forecast:

On the macro level, the US PPI in June fell beyond expectations, with both annual and monthly rates recording 0.1%, with the annual rate being the lowest in three years; Last week, the number of initial claims for unemployment benefits unexpectedly decreased to 237000. On Wednesday, well-known hawkish Federal Reserve figure Brad stepped down as Chairman of the St. Louis Fed and will no longer attend this month's interest rate meetings. The improvement in US inflation injects optimism into the market.

The basic situation of the spot market has entered the maintenance and recovery of multiple refineries in late July, and the newly expanded production line of regenerated refined lead is gradually opening or stabilizing production. The incremental supply of lead ingots is gradually reflected. The terminal consumption in the downstream battery market is average, while lead prices have been rising one after another, causing production costs for lead battery companies to rise. Recently, some companies have raised battery prices, and the promotion efforts in the battery wholesale market have narrowed. Currently, the operating rate of most large and medium-sized enterprises is between 70-80%. Overall, the volatility range of lead prices is expanding in the short term.