SHANGHAI, Dec. 19 (SMM) – Heavily influenced by LME lead prices, SHFE lead prices fell 5% last week and dropped to as low as RMB 14,915/mt on Thursday, a new low since November 18th. SHFE lead prices should move between RMB 15,000-15,600/mt this coming week.
In China’s domestic spot markets, traded prices for well-known brands decreased to RMB 15,200/mt from early week trading at RMB 15,600/mt, and with discounts of RMB 0-20/mt turning to premiums of RMB 50/mt over SHFE 1201 lead contract prices. Smelters were not actively selling goods due to lower prices, while downstream buyers were willing to buy goods at lower prices. Supply was limited in the market. Besides, despite year-end financial pressures, smelters still only move goods for long-term contracts due to lower lead prices. As a result, market supply shortages will grow. However, downstream demand is sluggish and buyers are only purchasing on as-needed basis, leaving spot prices soft. Domestic spot prices should move between RMB 15,100-15,400/mt in the coming week.