Lead social inventories declined for seven straight weeks

SHANGHAI, Apr 10 (SMM) – Social inventories of lead ingots in China extended decline, falling for the seventh consecutive week as of April 10. 
 
SMM data showed that lead social stocks across Shanghai, Guangdong, Zhejiang, Jiangsu and Tianjin decreased over 1,300 mt in the week ended April 10 to 10,000 mt. This followed the stocks declined 6,500 mt in the prior week.
 
Lead prices stabilised this week. This, together with a significant inventory draw in March and smelters delivery under long-term contracts, kept the shipments to social warehouses at relatively low levels. This reduced lead inventories in Shanghai and Guangdong, in particular.
 
Supply of secondary lead continued to expand and saw traded prices of secondary refined lead flip to discounts against primary lead. As of April 10, the discounts of secondary refined lead have widened to 150-100 yuan/mt over the average prices of SMM 1# lead. This drove consumers to shift demand to secondary materials. 
 
SMM expects the decline in China’s social inventories of lead ingots to narrow next week as demand from the downstream lead-acid battery market remains sluggish.