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SMM Daily Review - 2011/8/15 Lead Market
Aug 16,2011 09:38CST
price review forecast
SHFE lead prices stood successfully above RMB 16,800/mt after opening slightly higher at RMB 16,660/mt on Monday,

SHANGHAI, Aug. 16 (SMM) -- SHFE lead prices stood successfully above RMB 16,800/mt after opening slightly higher at RMB 16,660/mt on Monday, with prices briefly climbing to RMB 16,835/mt and later fell back to between RMB 16,700-16,780/mt. SHFE lead prices remained weak between RMB 16,700-16,750/mt in the afternoon session, and finally closed at RMB 16,730/mt. Trading volumes were down 322 lots to 1,048 lots, and positions were up 66 lots to 4,732 lots on Monday.

Although SHFE lead prices moved around the daily moving average after opening higher on Monday, domestic spot lead prices failed to be boosted but remained flat at last Friday’s level. Offers for well-known branded lead, including Chihong Zn&Ge and Shuikoushan, were generally in the RMB 16,300-16,350/mt range, with discounts between negative RMB 350-400/mt over SHFE 1110 lead contract prices. Few offers for other brands were heard in the market due to poor sales. In the afternoon business, almost no deals were made due to high prices, and prices for well-known branded lead fell by RMB 20/mt on average, with offers for Nanfang and Chihong Zn&Ge between RMB 16,280-16,320/mt. In addition, offers for other brands like Baiyin, Jinguan and Hanjiang were largely at RMB 16,200/mt. Spot lead prices were high and most downstream consumers stayed on the sidelines, keeping market trading sentiment muted.

With regard to lead prices trends this week, most market players are optimistic. 46.7% market players believe domestic lead prices should remain fluctuating. As LME lead prices continued fluctuating, with support at USD 2,260/mt, and since no economic news will be reported, domestic spot lead prices should fluctuate around RMB 16,300/mt.

The remaining 53.3% market players are optimistic, believing LME lead prices should edge up. Smelters are now holding goods given rallying LME lead prices, and battery supply from downstream producers is tight due to closures in environmental protection inspections, so battery producers will accept rising refined lead prices due to expanding margins. In this context, domestic lead prices should stand at RMB 16,500/mt level.

lead Pb

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