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In China’s domestic spot market, prices briefly slid to RMB 15,400/mt, causing smelters to hold goods since lead prices below RMB 16,000/mt are below the production cost line. As lead prices finally stabilized, downstream producers and traders both made purchases at low prices, causing prices to quickly rebound above RMB 16,000/mt. No goods were available at prices below RMB 16,000/mt, and prices of well-known branded lead returned to around RMB 16,100/mt, with spot discounts over SHFE 1109 lead contract between negative RMB 250-300/mt. Supply in domestic spot markets is down as sharp price declines dampened smelter interest in selling goods. In addition, some lead-acid battery producers have now resumed production as peak demand period for batteries nears, which will stimulate lead demand and support higher lead prices. Spot discounts over SHFE 1110 lead contracts will remain between negative RMB 300-400/mt, while spot lead prices should be between RMB 16,100—16,600/mt this week.
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