Lead Prices Weaken, Downstream Restocking on Demand, Smelters Cautious in Shipments, Spot Cargo Trend Firm [SMM Lead Morning Meeting Summary]

Futures:

Last Friday, LME lead opened at $1,953/mt, swung wildly during Asian trading and hit a low of $1,947.5/mt; entering the European session, LME lead fluctuated upward, touching a high of $1,968.5/mt in late trading, and finally settled at $1,967/mt, up 0.49%.

Last Friday evening, the most-traded SHFE lead 2607 contract opened at 16,055 yuan/mt, dipped briefly to a low of 16,035 yuan/mt, then moved sideways, hitting a high of 16,125 yuan/mt near the close, and finally settled at 16,100 yuan/mt, up 0.28%.

On the macro front:

According to a Reuters/Ipsos poll, US President Trump's approval rating among voters in rural America dropped to 50%, the lowest of his presidency. Middle East tensions--Trump: Iran deal reached, free passage through the Strait and US military blockade lifted. The PBOC released its financial statistics report for May 2026: M2 was flat while M1 rose; the incremental scale of aggregate social financing in the first five months reached 17.48 trillion yuan.

Spot fundamentals:

SHFE lead continued to be in the doldrums, once again nearing the 16,000 mark. Suppliers were somewhat divided in their shipments, with quotations featuring both premiums and discounts. Inventories at smelters in major producing regions declined, and suppliers held prices firm when selling. Electrolytic lead from major producing regions was quoted at premiums of 0-100 yuan/mt against the SMM #1 lead average price, EXW. In secondary lead, smelters offered limited cargoes, with some secondary refined lead quoted at premiums of 0-25 yuan/mt against SMM #1 lead, EXW. Downstream enterprises maintained just-in-time procurement, mainly sourcing EXW cargoes from smelters, while transactions for warehouse cargoes in the Jiangsu, Zhejiang, Shanghai market were modest.

Inventory side: On June 12, LME lead inventory decreased by 775 mt to 305,875 mt. As of June 11, total SMM lead ingot social inventory across five locations reached 65,400 mt, down 1,700 mt from June 4, and up over 700 mt from June 8.

Today's lead price forecast:

On the consumption side, lead-acid battery enterprises maintained relatively stable production. After the decline in lead prices, downstream enterprises bought the dip as needed, and considering possible mid-year book closing and inventory checks in late June, some downstream firms made advance purchases. On the supply side, primary and secondary lead enterprises saw both increases and decreases in production, with supply expected to show little difference. In-factory inventories at both types of smelters declined, easing the pressure to sell. In particular, heavy losses at secondary lead smelters discouraged them from offering cargoes. Spot lead is expected to continue being quoted at small premiums against SMM #1 lead, and if SHFE lead falls further, the possibility of spot prices exceeding futures cannot be ruled out.