Social lead ingot inventory across five major regions in China last week

According to SMM survey, social lead ingot inventory across five major regions in China totalled 68,700 mt as of October 27, up 1,600 mt from Friday October 20 and 900 mt from Monday October 23.

Some primary lead smelters continued to be in maintenance last week. Lead consumption performance was poor. Especially after the new long-term contracts for November began to be fulfilled, downstream demand for lead ingots under small orders fell compared with a week earlier. In this scenario, lead smelters expanded discounts under small orders. As of last Friday, discounts against the average SMM #1 lead price in south China were 200-100 yuan/mt, ex-works; in Jiangsu, Zhejiang and Shanghai, spot premiums turned from 150 yuan/mt over the SHFE November lead contract two weeks ago into discounts of 50 yuan/mt last week. This drove deliveries of some deliverable brands to warehouses for hedging, growing social inventory of lead ingots. This week, the lead-acid battery consumption is expected to be mixed. Downstream companies will maintain on-demand purchases for lead ingots, and the social inventory of lead ingots may continue to increase slightly.