SMM Brief Review - 2012/2/2 SHFE Lead Futures

The power rationing in Yunnan, Henan, and Hunan since July-August and the power rationing in Jiangxi and Guangxi in September are undoubtedly the current hot spots. According to a recent SMM survey, the power rationing in Jiangsu, Guangdong and other regions in China has continued. Since late September, the social inventory of lead ingots has declined due to the combined effects of losses, power rationing and environmental protection.

LME lead will fluctuate at highs between USD 2,460-2,490/mt today.

Motive battery supply is tight in China's market and will ease in mid and late June.

Total trading volume in the London exchange decreased in the first quarter of 2017 to 1.5 percent to 38.86 million tons from previous year, as per Hong Kong Exchanges and Clearing.

Average operating rate at surveyed 51 Chinese lead-acid battery producers was 62.12% in March, up 3.35 percentage points MoM but down 4.41 percentage points YoY.

SHFE 1702 lead started at RMB 18,800/mt and finally ended at RMB 18,780/mt, up RMB 315/mt or 1.71%.

Operating rates at lead producers picked up in Yunnan’s Gejiu who halted operation previously because of profitable lead prices and TCs.

LME lead will trade higher at USD 1,690-1,725/mt during Asian trading hours Tuesday owing to position opening by longs.

SHFE 1512 lead followed LME lead up to RMB 13,645/mt after opening Wednesday evening session at RMB 13,580/mt.

Y​unnan Chihong Zn&Ge’s profit in the first half of this year dropped 35.07% year-on-year to 53.74 million yuan, down from 82.77 million yuan in the same period last year.