Lead Prices Fluctuate Upward, Downstream Enterprises Adopt a Wait-and-See Attitude [SMM Lead Morning Comment Nov 29]

Overnight, LME lead opened at $2,058.5/mt, fluctuated downward during the Asian session, and dipped to $2,037/mt in the European session. However, due to the weakening US dollar, the pressure on base metals was released, and LME lead rebounded in a V-shape, reaching a high of $2,070/mt and finally closing at a high of $2,044/mt, down 0.78%.

Overnight, the most-traded SHFE lead 2501 contract opened at 16,955 yuan/mt, briefly touched a low of 16,935 yuan/mt at the beginning of the session, and then fluctuated rangebound around the intraday moving average. The contract reached a high of 17,470 yuan/mt and finally closed at 17,365 yuan/mt, up 2.79%.

Macro side, Trump stated that he would raise tariffs on China after taking office. The Chinese Ministry of Commerce responded that China's stance against unilateral tariff hikes is consistent. The Biden administration is expected to announce new export restrictions on China as early as this week. The Chinese Ministry of Commerce responded that if the US insists on escalating controls, China will take necessary measures. The General Office of the CPC Central Committee and the General Office of the State Council issued opinions on the reform and innovative development of digital trade, aiming to cultivate and expand digital trade business entities. The China Banking Research Institute expects China's GDP to grow by about 5% in 2025. The Ministry of Commerce commented on the progress of the China-EU EV anti-subsidy case, stating that consultations are still ongoing.

Fundamentals, this week, smelting enterprises in Hebei and Anhui have not fully resumed production after reducing output, while primary lead smelting enterprises in Jiangxi and Guangdong have entered maintenance, tightening lead ingot supply again. Lead prices fluctuated upward, and downstream enterprises have generally adopted a wait-and-see attitude, temporarily slowing down procurement activities. The drop in lead ingot social inventory has slowed compared to last week. In the secondary lead sector, the recovery of profits has boosted production enthusiasm among enterprises. Excluding those planning maintenance in early December, some large refineries are expected to resume production in December. Overall, lead prices are likely to hover at highs.