Raw Material Pressure on Secondary Lead Smelters Eased, Lead Market Oscillated Amid Weak Supply and Demand [SMM Lead Morning Brief]

SMM, May 19:

Overnight, LME lead opened at $1,983.5/mt. Prices moved sideways within the range of $1,976-1,987/mt, fluctuating repeatedly around the average price line of $1,981/mt. The tug-of-war between longs and shorts remained intense with no clear unidirectional trend. It finally closed at $1,981/mt, down $3/mt or 0.15%.

Overnight, the most-traded SHFE lead 2026 contract opened higher with a gap at 16,505 yuan/mt. Early in the session, SHFE lead prices briefly fluctuated downward, touching a low of 16,435 yuan/mt. Prices then moved higher during the session before pulling back slightly near the close, ultimately settling at 16,485 yuan/mt. It recorded a bearish candlestick, up 10 yuan/mt or 0.06%.

Last week's lead price pullback triggered panic selling by recyclers, providing a phased relief to the pressure of raw material inventory shortages at secondary lead smelters. This week, production cuts and shutdowns caused by tight raw material supply at smelters improved somewhat, but the overall industry operating rate remained at a low level. Combined with declining imported lead inflows, the supply side showed marginal contraction. The demand side continued its weak trend, and the supply-demand dual-weakness pattern persisted. Lead prices are expected to maintain a fluctuating trend in the short term.