SHANGHAI, Nov 8 (SMM) – Social inventories of lead ingots in China rose this week for a second straight week, showed an SMM survey, as a plunge in lead prices and weakness in downstream consumption kept buyers cautious about procurement and as smelters put their cargoes on warrants.
As of November 8, lead social stocks across Shanghai, Guangdong, Zhejiang, Jiangsu and Tianjin increased by 6,500 mt from a week earlier to 30,000 mt.
Lead prices on the Shanghai Futures Exchange fell to the secondary lead cost-supported 16,000 yuan/mt level this week, while secondary lead smelters barely scaled back their discounts against primary lead.
Tepid demand and flows to secondary lead kept primary lead smelters from clearing their stocks, triggering deliveries to SHFE warehouses and bolstering social inventories.
Lead social inventories are likely to continue to expand next week, as traders are unlikely to further increase their discounts ahead of the SHFE November delivery and secondary lead smelters in Anhui will resume.