Focus on the Impact of Lead Ingot Inventory Buildup and Downstream Resumption Progress on Lead Price Trends [SMM Lead Morning Meeting Summary]

Futures Market:

Overnight, LME lead opened at $1,945/mt, fluctuated rangebound during the Asian session, and fluctuated downward during the European session, hitting a low of $1,940/mt. By the end of the session, the weakening US dollar eased resistance, leading to a rebound and recovery, with prices peaking at $1,973.5/mt and closing at $1,969.5/mt, up 1.26%.

Due to the Chinese New Year holiday, SHFE lead was closed and will resume trading on Wednesday.

》Click to view SMM lead spot historical prices

Macro:

Economists at Morgan Stanley stated that they no longer expect the US Fed to cut interest rates in March and now anticipate one interest rate cut in June this year. China will impose additional tariffs of 10%-15% on certain imports originating from the US. The Ministry of Commerce and the General Administration of Customs of China announced export controls on items related to tungsten, tellurium, bismuth, molybdenum, and indium.

Spot Fundamentals:

As the Chinese New Year holiday approaches, logistics vehicles have further decreased, nearing a complete halt, and suppliers in the Jiangsu, Zhejiang, and Shanghai markets have rarely quoted prices. On Friday morning, SHFE lead fluctuated upward, with some suppliers making final deliveries, including purchases by downstream enterprises over the past two days and some transfers to delivery warehouses. Quotes in the secondary lead market were also scarce, with individual suppliers offering ex-factory prices at a premium of 50 yuan/mt against the SMM 1# lead average price, while most enterprises refrained from shipments or quotations. By Friday, downstream enterprises had largely ceased inquiries, and the spot market exhibited a state of nominal prices without transactions.

Inventory: On February 4, LME lead inventory increased by 250 mt to 220,875 mt, up 0.11%. As of January 27, the total social inventory of SMM lead ingots across five regions stood at 39,200 mt, down 6,700 mt from January 20 but up approximately 100 mt from January 23.

》Click to view the SMM metal industry chain database

Lead Price Forecast:

During the Chinese New Year holiday, most downstream battery producers are on holiday, with only a few enterprises continuing production, primarily consuming their own lead inventory. Logistics no longer support spot transactions. Additionally, some primary and secondary lead enterprises are conducting shift work during the holiday, with production cuts and holidays on the supply side being far less significant than on the consumption side. This week, attention will focus on lead ingot inventory buildup and the impact of downstream resumption progress on lead price trends.