SHANGHAI, Aug 17 (SMM) - LME lead stopped declining after dropping to the line of $2,250/mt and closed at $2,300/mt, reaching a high of $2,343/mt.
The US Senate passed the $1 trillion infrastructure bill. The loose economic policy has eased market pessimistic sentiment. The US dollar index has weakened and LME and SHFE lead prices trended higher.
LME lead stocks continued to decrease and stocks of warehouse warrants fell below 60,000 mt, setting a record low. LME lead was well supported. The weekly K-line of the lead fell into positive range last week and the upward momentum was slightly insufficient.
The most-traded SHFE 2109 lead contracts stood at 15,320-15,690 yuan/mt last week, which continued to weaken early last week. SHFE lead prices have fallen nearly 1,000 yuan/mt. Holders held a cautious outlook. SHFE lead rose slightly as LME lead rebounded in midweek.
The expectations of stock accumulation and declining consumption on Covid-19 pandemic pressured on the upward trend of lead prices. Short positions kept falling last week. The weekly K-line fell into a negative range.
Shipments from primary lead smelters were low and quotations were less frequent as lead prices were sluggish early last week, coupled with thin inventories.
Some smelters increased premiums as lead prices rose slightly in mid-week. The mainstream premiums stood at 0-100 yuan/mt over SMM #1 lead small orders.
The market was dominated by deliveries, largely raising premiums. But downstream buyers rarely restocked spot goods due to high premiums.
Profits of secondary lead recovered slightly, but discounts failed to widen. Shipments were modest. Discounts of secondary refined lead recorded 200-250 yuan/mt on an exfactory basis against the average price of SMM #1 lead.