Pre-holiday restocking lowers lead social inventories on week

SHANGHAI, Sep 12 (SMM) – Social inventories of refined lead in China continued to fall this week as downstream battery producers stepped up stockpiling for the mid-autumn festival holiday on Friday and the National Day holiday in October. 

Primary smelters in Henan and Yunnan provinces conducted maintenance this week, which helped deplete lead stocks in Jiangsu, Zhejiang, and Guangdong.  

SMM data showed that lead social stocks across Shanghai, Guangdong, Zhejiang, Jiangsu and Tianjin fell for the sixth consecutive week, 2,300 mt lower from a week ago and stood at 27,400 mt as of Thursday September 12. The decline slowed from a drop of 5,580 mt in the previous week due to greater supply of secondary lead in the second half of this week. 

Increase in secondary lead supply grew discounts of secondary refined lead, which stood at 300-150 yuan/mt against the average prices of SMM #1 lead, on an ex-factory basis, as of Thursday September 12. 

Lead social inventories in China may build up next week as the supply of secondary lead extends increases on normal operations across smelters during the mid-autumn festival holiday. Downstream battery producers also planned for suspension during the holiday, SMM learned.