SMM net news: spot market: yesterday, Shanghai lead continued to shock weak, holders quoted relatively more, rising discount price is a small increase. However, the consumption of downstream battery enterprises has not been significantly improved, and most of them are still dominated by rigid demand. Transactions in Guangdong have improved slightly, but spot transactions in areas such as Henan and around Shanghai are still relatively light.
Inventory status: yesterday, lead stocks in the previous period were flat at 22419 tons compared with the previous trading day. After the delivery date of last month, the inventory in the previous period continued to show a slow rise, so that the current inventory is still in a relatively high position, on the contrary, downstream demand has always shown a dismal situation. Therefore, the current focus still needs to pay attention to the actual demand of downstream battery enterprises. At a time when last-term and social inventories total about 57000 tons, compared with just over 8500 positions in July, it seems relatively difficult to close positions in previous years. However, the future needs to pay attention to whether downstream demand can recover in the summer, the current August contract positions of about 50,000 hands, and such inventory to position ratio still has the possibility of pressing positions.
Import profit and loss situation: yesterday's RMB midpoint fell 65 basis points from the previous trading day to 6.8705, yesterday's domestic lead prices continued to be weak, the current import profit window has not yet reached the open state. And downstream demand has yet to show clear signs of recovery, and in the face of dismal demand, even if the future import profit window is open, there is unlikely to be a large inflow of foreign inventories.
Price difference between recycled lead and primary lead: yesterday the price difference was flat at-150 yuan / tonne. The day before yesterday, due to the slight recovery of downstream demand, the relatively obvious price advantage of recycled lead was favored, so the price difference between regenerated lead and primary lead was slightly narrowed. If the downstream demand can be further recovered in the future, then the most obvious sign may be that the price difference between regenerated lead and primary lead will continue to narrow. However, at present, recycled lead enterprises are basically in a loss-making state of production, so this may produce some support for lead prices again.
Neutral, yesterday lead prices continue to show a volatile pattern, downstream demand is limited, renewable lead and primary lead price difference has not further narrowed, the current need to focus on lead varieties of traditional consumption season approaching storage enterprise procurement can gradually warm up, and in the operation of the first relatively neutral high throwing low absorption train of thought. On the other hand, enterprises that hold spot can continue to take the operation of selling call options to collect royalties.
Inventory changes in the last period of demand of downstream storage enterprises. (source: Huatai Futures)