Social Inventory Pressure VS Firm Supplier Quotations: Lead Prices Maintain Fluctuating Trend [SMM Lead Morning Meeting Summary]

Futures Market:

Overnight, LME lead opened at $2,083.5/mt, briefly touched a low of $2,078.5/mt during the Asian session, and fluctuated upward to a high of $2,095/mt in the European session, finally closing at $2,091.5/mt, up 0.34%.

Overnight, the most-traded SHFE lead 2504 contract opened at a high of 17,615 yuan/mt, fluctuating around 17,600 yuan/mt after the opening, with a low of 17,550 yuan/mt and a high of 17,620 yuan/mt, and finally closed at 17,605 yuan/mt, up 0.09%.

》Click to View SMM Lead Spot Historical Prices

Macro:

Three Chinese departments: Support the scrappage and renewal of China III and China IV vehicle emission standard operating trucks and accelerate the replacement of a batch of high-standard, low-emission operating trucks. SHFE: Recently, precious metal prices have been volatile, prompting market participants to strengthen risk control measures. Additionally, the application scope of "Shanghai Gold" will be further expanded.

Spot Fundamentals:

In the Shanghai market, Chihong lead was quoted at 17,590-17,625 yuan/mt, with a premium of 30-50 yuan/mt against the SHFE lead 2504 contract. In Jiangsu and Zhejiang regions, Tongguan and JCC lead were quoted at 17,560-17,575 yuan/mt, on par with the SHFE lead 2504 contract. After surging, SHFE lead slightly pulled back, with its overall price center shifting downward. Market circulation of cargoes was limited, and suppliers stood firm on quotes. During this period, primary lead cargoes self-picked up from production sites were generally sold at a premium, with premiums slightly lower than the previous day. Secondary refined lead was sold at a narrower discount, quoted at a discount of 75-0 yuan/mt against the SMM 1# lead average price on an ex-factory basis. Most enterprises focused on long-term contract procurement and maintained a cautious sentiment, with some making just-in-time procurement as needed.

Inventory: On March 18, LME lead inventory increased by 8,275 mt to 219,975 mt. As of March 17, the total social inventory of lead ingots in five major regions tracked by SMM reached 71,700 mt, up by 5,500 mt from March 10 and by 4,000 mt from March 13.

》Click to View SMM Metal Industry Chain Database

Lead Price Forecast Today:

After the smooth delivery of the SHFE lead 2503 contract, social inventory of lead ingots remains high. The downstream lead-acid battery market performed moderately, with battery producers maintaining just-in-time procurement. In the short term, inventory pressure may weigh on lead prices. Additionally, the supply of scrap batteries remains tight, and rising refinery procurement prices provide strong support for lead prices. Secondary lead suppliers, facing cost pressure, narrowed their discounts. Overall, lead prices are expected to maintain a fluctuating trend in the short term.