Futures:
Last Friday, LME lead opened at $2,017/mt. Amid expectations of a US-Iran ceasefire, base metals held up well, and LME lead maintained a firm tone throughout the day, reaching an intraday high of $2,027.5/mt, a new high since late January this year. Toward the end of the evening session, some bulls took profits, and LME lead reversed to give back gains, ultimately closing at $2,011.5/mt, down 0.37%.
Last Friday, the most-traded SHFE lead 2607 contract opened at 16,580 yuan/mt. Initially, driven by lead ingot destocking, SHFE lead fluctuated at highs after the opening, trading mostly within 16,585-16,600 yuan/mt. Subsequently, dragged down by the decline in LME lead, SHFE lead turned lower, ultimately closing at 16,540 yuan/mt, down 0.06%. Open interest stood at 64,210 lots, down 1,648 lots from the previous trading day.
On the macro front:
China's overall economic output maintained expansion in May: the official manufacturing PMI edged down MoM to 50, affected by external demand retreating after rapid rise, while the non-manufacturing PMI rebounded to 50.1, with business activity returning to expansion territory. Over the weekend, US-Iran negotiations shifted again. According to foreign media reports, Trump significantly revised the memorandum of understanding with tougher terms in an attempt to pressure Iran into accelerating negotiations. US officials said Iran would likely need three days to respond to the revised demands. US Defense Secretary: Trump is very patient with US-Iran negotiations, and "any deal would be worthwhile." Trump: if the US and Iran cannot reach an agreement, the "war department" will step in. Iranian sources: Iran may propose new revisions to the memorandum of understanding text. Iranian Parliament Speaker: no agreement will be approved until Iranian people's rights are confirmed to be guaranteed. Iranian Foreign Minister: until negotiation results are clear, everything is speculation.
:
Last Friday in the lead spot market, circulating cargoes in Jiangsu, Zhejiang, Shanghai were limited. Suppliers quoted in line with the market, with shipments mostly consisting of cargoes self-picked up from production site. Mainstream-origin primary lead was quoted at premiums of 0-50 yuan/mt against the SMM #1 lead average price, ex-works. On the secondary lead front, smelter production gradually resumed, with some divergence in shipments—some held prices firm at premiums, while others offered at discounts to reduce inventory. Secondary refined lead was quoted at discounts of 50 to premiums of 75 yuan/mt against SMM #1 lead, ex-works, with individual regions at discounts of 150 yuan/mt. Downstream enterprises maintained purchasing as needed, and due to price differences, rigid demand leaned toward primary lead cargoes self-picked up from production site, with limited improvement in spot market transactions.
Inventory: As of May 6, LME lead inventory stood at 314,000 mt, unchanged from the previous trading day. SHFE lead ingot warrant inventory totaled 60,803 mt, down 5,392 mt from the previous trading day. SMM total social inventory of lead ingots decreased by 5,000 mt compared to May 21.
Lead Price Forecast for Today:
The macro landscape was complex and intertwined, while lead fundamentals varied. In markets outside China, as LME lead had previously been in a backwardation structure, suppliers increasingly shipped to delivery warehouses, pushing LME lead inventory to its highest level since 2013. In China, combined effects of maintenance at major primary lead enterprises and downstream dip-buying drove lead ingot inventory further down. Meanwhile, more secondary lead enterprises resumed production, the lead ingot supply gap is about to be filled, and upward momentum for lead prices remains insufficient.
Data Source Disclaimer: Data other than public information is derived from public information, market communication, and SMM's internal database models, processed by SMM for reference only and does not constitute decision-making advice.
![Complex Situation Outside China, LME Lead Pulled Back After Hitting Highs [SMM Lead Morning Brief]](https://imgqn.smm.cn/usercenter/TmYox20251217171721.jpeg)
