SHANGHAI, Jun. 7 (SMM) – Base metals slumped across the board at the tail trading of June 6, while SHFE 1707 lead outperformed other metals, which held slight fluctuation.
“Positive fundamentals shore up lead prices.” SMM lead senior analyst Wang Lan says. Lead prices will stay firm in a short term in anticipation of supply shortage, demand improvement and inventory reduction, SMM expects.
On the supply front, lead concentrate supply is tight but still ample. Primary lead output drops as environmental protections and maintenance lead to production suspensions at lead smelters. Small secondary lead smelters, closing down due to environmental checks, remain offline. Moreover, output resumption date at some large qualified secondary lead smelters in Anhui is unclear yet, tightening secondary lead supply. Secondary lead prices have reversed to premiums of 200 yuan per tonne from discounts of 300 yuan per tonne, against prices of SMM #1 lead.
On the demand front, downstream battery producers have raised operating rates in response to improving battery demand.
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