Lead prices fluctuated upward this week, spot secondary lead trades were weak, and the industry's loss-making pattern continued [SMM Secondary Refined Lead Weekly Review].

SMM, June 18:

Lead prices first rose then fell this week. At the beginning of the week, smelters showed clear divergence in shipments, with secondary refined lead quoted at discounts of 25 yuan/mt to premiums of 125 yuan/mt. Downstream battery plants digested inventories, weakening transactions. Mid-week, increased maintenance at smelters tightened supply, and mainstream quotations shifted to discounts of 50-0 yuan/mt. Towards the weekend, lead prices pulled back slightly, with the discount range remaining unchanged. Ahead of the Dragon Boat Festival, downstream users halted procurement early, with a strong wait-and-see sentiment prevailing. Spot transactions were sluggish throughout the week.

Lead prices rose by 345 yuan/mt on a weekly basis. Downstream users turned wait-and-see before the Dragon Boat Festival, and transactions for secondary refined lead were subdued. Smelters' raw material inventories declined, but they were reluctant to raise purchase prices for feed, leaving scrap battery purchase prices basically stable. As of June 18, large secondary lead enterprises suffered losses of 395 yuan/mt, while small and medium-sized plants incurred losses of 597 yuan/mt, narrowing by 113-115 yuan/mt compared with June 12. Looking ahead, with both production increases and cuts coexisting among secondary smelters, the quotation range for refined lead is expected to remain between discounts of 50 yuan/mt and premiums of 50 yuan/mt. Currently, low raw material inventories at smelters underpin scrap battery prices, but raising purchase prices for feed would exacerbate losses. Purchase prices are expected to remain predominantly stable. With weak finished product prices and high costs, the industry's loss-making situation is unlikely to improve in the short term, with small and medium-sized plants suffering more severe losses.