Lead ingot social inventory hit a record high

SHANGHAI, Jun 4 (SMM) - Social inventories of lead ingots across Shanghai, Guangdong, Zhejiang, Jiangsu and Tianjin increased 7,600 mt from the prior week and rose 5,800 mt from May 31 to 110,700 mt as of Friday June 4, hitting a record high since May 2015, an SMM survey showed.

Lead ingot supply was stable this week, while consumption remained sluggish. Lead prices fluctuated at high levels early in the week, and traders mostly offered bulk goods due to high prices. Domestic lead was mainly offered at discounts of 50-0 yuan/mt against SHFE 2106 lead contract, and smelters offered goods at discounts of 150-0 yuan/mt against the average prices of SMM #1 lead. Secondary refined lead was quoted at a discount of 300 yuan/mt against the average prices of SMM #1 lead. Downstream users had wider choices amid sufficient available resources in the market, and the trade quietened. Social inventories of lead ingots remained upward as the delivered goods gradually arrived at social warehouses. Smelters and traders are expected to keep delivering next week as the settlement day and the Dragon Boat Festival are approaching. Lead prices moved close to 15,000 yuan/mt, which will boost downstream purchase on rigid demand, but the increase in lead ingot social inventory may slow down.