[minutes of SMM Morning meeting] lead prices have fallen sharply and profits for recycled lead have narrowed.

2020.7.16

Summary of lead Morning meeting:

Futures market:

Overnight, Lun lead opened at 1850 US dollars / ton. In Asian time, Lun lead fluctuated in a narrow range, focusing on the first line of 1850 US dollars. Entering the European period, Lun lead concussion fell, then rebounded low, reached a high of 1872.5 US dollars / ton, and then gave up the rise. It was finally reported at 1853.5 US dollars / ton. As of yesterday, LME lead stocks had increased by 1775 tonnes. (bullish)

Overnight, Shanghai lead opened at 15415 yuan / ton. At the beginning of trading, Shanghai lead fell rapidly, reaching a low of 15310 yuan / ton, then stabilized, and then basically around the time-sharing line, finally reported at 15405 yuan / ton, a decline of 0.29%. As of yesterday, the warehouse receipt inventory of the previous period increased by 5395 tons to 38493 tons, the 07 contract closed at 15455 yuan / ton, the settlement price was 15605 yuan / ton, the position was 6820 lots, and the delivery volume was 34100 tons, achieving smooth delivery. (bullish)

Spot fundamentals:

50 yuan / ton discount for Shanghai lead 2007 contract in Shanghai market, 50 yuan / ton discount to Shanghai lead 2007 contract in the south of Jiangsu and Zhejiang market, 50 yuan / ton discount to Henan Jinli and Wanyang lead 2007 contract, and 25 yuan / ton price increase to SMM1# lead price in Minshan, Henan Province. Lead fell back at a high level, and yesterday was the day of delivery, with few quotations from holders and some discounted quotations, while the downstream was afraid of falling and waiting to wait and see. It was still biased towards refinery supply only when it was just needed, and trading in the spot market did not improve. The supply of waste batteries is still tight, the purchasing enthusiasm of smelters is high, and the price of waste batteries is easy to rise and difficult to fall. In addition, the price of lead continues to decline slightly, the profits of recycled lead refineries narrow, and the discount of recycled refined lead shrinks to some extent, but due to fear of high mining and careful mining in the lower reaches, most of them are just needed, and recycled refined lead is still in a state of deep sticking to water.

Lead price forecast today:

Lun lead as a whole to maintain the trend of high shock, short-term attention to overseas macro events. Shanghai lead high decline upward trend slowed, the future focus on the support near the 10th line.

It is expected that the price of lead in SMM1# will drop by 200 RMB250 / ton today.