Oct. 17-21 (SMM) -- In the week following the holiday, SHFE lead prices edged up, but gains were slower compared to LME lead, with prices between RMB 14,550-15,000/mt. Trading volumes were limited given investor caution. This week, SHFE lead prices will fluctuate between RMB 14,500-15,400/mt.
In China’s domestic spot market, prices rallied to RMB 14,950/mt, up from RMB 14,750/mt early in the week, but still failed to break through the RMB 15,000/mt mark. Despite the lack of any sustained rebound, domestic smelters were forced to sell some goods to generate cash. Downstream producers purchased actively at low prices, especially early in the week.
In China’s domestic markets, downstream producers would gladly purchase at low prices, but lead smelters may be wary of sales, waiting instead for prices to rebound. The lack of goods will support spot prices, so spot transactions will likely be made between RMB 14,500-15,400/mt this week, with spot premiums at RMB 0/mt over SHFE 1111 lead contracts.