SHANGHAI, Jul 2 (SMM) - Social inventories of lead ingots across Shanghai, Guangdong, Zhejiang, Jiangsu and Tianjin increased 5,200 mt from the prior week and rose 5,100 mt from June 28 to 131,000 mt as of Friday July 2, hitting a record high since March 2015, an SMM survey showed.
The production of primary and secondary lead was largely unchanged this week, and downstream purchase remained low. Lead prices bottomed out, and rose to near 16,000 yuan/mt later this week. Downstream users only purchased on rigid demand early this week, and then mostly turned wait-and-see, so the market trade was quiet. At the same time, lead futures went up, spot discounts expanded, and the price difference between futures and spots was over 400 yuan/mt, prompting holders to deliver goods. The inventories were transferred from plants to social warehouses. The supply and demand of lead ingots are expected to stay unchanged next week. Export expectations appeared amid the opened export window, but the actual exports were impeded by the adverse transportation conditions. In addition, the goods were flowing into social warehouses before the contract settlement. Lead ingot social inventories are expected keep rising next week.