SHFE 1507 Lead Ends down RMB 25/mt (May 27, 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-actively traded contracts on SHFE market all reported declines except lead on May 9.

LME lead should test support at $ 1,730 per tonne next week with support at the 60-day moving average.

LME lead should move at lows of USD 1,590-1,620/mt during Asian trading hours Monday after falling below the 5-day moving average again.

LME lead will face weakness and move between USD 1,580-1,610/mt during Asian trading hours Tuesday.

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

LME lead recently posts a fall and should drop to USD 1,710-1,740/mt during Asian trading hours Wednesday.

SMM survey of 30 Chinese market players shows that 60% of them note that LME lead will move between USD 1,730-1,800/mt this week.

With overall bearishness, SHFE 1512 lead gapped lower at RMB 13,540/mt for night trading Tuesday and narrowly moved around RMB 13,550/mt.

A total of 40% industrial insiders expect lead prices to go up this week, SMM survey reveals.