SHFE 1506 Lead Edged up RMB 20/mt (Apr. 28, 2015)

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.

The most-traded SHFE lead contract fell as a whole in September, with a decrease of 3.69% in the month. The contract closed at 14350 yuan/mt as of September 30, down 550 yuan/mt from the beginning of the month.

Three-month LME lead bottomed out during China’s National Day holiday. LME lead fell to $2,060/mt on September 30 and rebounded to $2,168/mt on October 1. Then the prices fluctuated between $2,130-2,170/mt during the holiday. LME lead closed at $2,136/mt yesterday, down $0.5 or 0.02%. The open interest stood at 109,000 lots.

China produced 276,900 mt of refined lead in August, down 0.75% from July and 2.69% from a year ago.

Shanghai base metals all went down on Friday night following the record low of the US weekly initial jobless claims. Meanwhile, their counterparts on LME basically went up.

Shanghai base metals trended higher on Wednesday morning after US Senate passed the $1 trillion infrastructure bill. Meanwhile, their counterparts on LME mostly fell.

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.

LME lead will move at USD 2,120-2,180/mt on Monday and SHFE 1706 lead is expected to fluctuate between RMB 15,700-16,250/mt.

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.