Futures:
Overnight, LME lead opened at $1,965/mt. With no significant changes in fundamentals and a tug-of-war between longs and shorts reaching a relative stalemate, LME lead fluctuated rangebound throughout the day, mostly trading between $1,960-1,970/mt, and finally closed at $1,967/mt, up 0.28%, ending the recent six-day losing streak.
Overnight, the most-traded SHFE lead 2603 contract opened at 16,585 yuan/mt. Trading was sluggish during the session, and as the holiday approached, some participants exited the market, causing SHFE lead's fluctuation range to narrow further. It basically traded between 16,600-16,625 yuan/mt overnight until finally closing at 16,620 yuan/mt, up 0.12%. Its open interest fell to 57,133 lots, down 1,143 lots from the previous trading day.
On the macro front:
It was reported that Xi Jinping held a phone conversation with US President Trump. Xi Jinping held a video meeting with Russian President Putin. The PBOC emphasized efforts to support key areas such as expanding domestic demand, technological innovation, and small and medium-sized enterprises. Separately, US job growth slowed significantly, with ADP employment increasing by 22,000 in January, below the expected 45,000. The US January ISM Services PMI hit a new high since 2024, employment barely expanded, and the price index climbed.
:
In the lead spot market yesterday, lead prices remained weak and consolidating. Traders generally sold at discounts, while smelters were reluctant to sell at low prices, keeping their quotations relatively firm. Mainstream origin quotations against the SMM #1 lead average price were at discounts of 50 yuan/mt to premiums of 50 yuan/mt ex-works. In the secondary lead sector, losses widened, leading to increased production cuts or suspended sales by smelters. Secondary refined lead quotations against the SMM #1 lead average price were at discounts of 25 yuan/mt to premiums of 50 yuan/mt ex-works, with the price spread between primary lead and secondary lead inverted in mainstream origins. Downstream enterprises largely completed pre-holiday stockpiling, with some having suspended purchases, while others made purchases as needed at low prices. A small amount of heavily discounted material could be used for additional stockpiling.
Inventory: As of February 4, LME lead inventory remained flat compared to the previous trading day, staying at 232,850 mt. SMM lead ingot social inventory across five regions continued its upward trend, reaching a two-month high.
Today's Lead Price Forecast:
As the Chinese New Year holiday approaches, enterprises across the lead industry chain are gradually starting holidays, especially downstream enterprises. This directly weakens spot lead trading, resulting in sluggish supply and demand overall, weighing on lead prices and keeping them weak and consolidating. Furthermore, pre-holiday lead consumption is declining, increasing the risk of lead ingot inventory buildup. Meanwhile, prices of raw materials like scrap batteries remain high, causing losses for secondary lead enterprises. Cost support coexists with inventory buildup risks, and lead prices are expected to continue fluctuating rangebound in the short term.
Data Source Statement: Except for publicly available information, all other data are processed by SMM based on public information, market communication, and the SMM internal database model, and are for reference only, not constituting decision-making advice.
