SHANGHAI, Oct 11 - Futures: LME 3M contract opened at $2,035/mt yesterday and fell to the lowest point at $1,971/mt, then rebounded.  LME 3M contract continued to fall after hitting the highest point at $2,063/mt and finally closed at $1,971/mt, down 3.24%.  SHFE 2211 lead contract opened high and then fell back quickly overnight. SHFE 2211 lead contract hovered sideways around 15,250 yuan/mt and finally closed at 15,245 yuan/mt, up 0.1%,SHFE 2209 lead contract finally closed at 15245 yuan/mt, down 0.1%,

Spot fundamentals: In terms of primary lead, Chihong lead in Shanghai market, Jiangxi Copper Group and Anhui Tongguan Copper Foil Group lead in Zhejiang market quoted at 15,250-15,260 yuan/mt, in discounts of 0-10 yuan/mt over SHFE 2211 lead contract. On the first trading day after the National Day holiday, SHFE lead rose strongly, and the cargo holders shipped, but most downstream companies were wait-and-see and mainly received long-term orders. The retail market was thin. The discounts of the smelter changed little compared with that before the holiday, but due to the pre-sale and long-order delivery during the holidays, the in-plant inventory was limited. The smelters in Hunan quoted in discounts of 100 yuan/mt over SMM 1# lead ingot, and the discounts in Yunnan was 300- 250 yuan/mt. The retail transactions were thin.

In terms of secondary lead, yesterday's quotation rose, following the increase in the price of SMM 1# lead ingots, and the price spread between refined lead and secondary lead did not change much. The overall discounts of secondary refined lead smelters over SMM 1# lead ingots stood at 150-100 yuan/mt. However, the downstream enterprises were unwilling to pick up goods and some smelters reported that no goods were shipped in the form of small orders as of the close of noon yesterday.

Lead price forecast: The lead prices rose yesterday due to the soaring LME lead prices during holiday, but the willingness of downstream enterprises to receive goods was obviously sluggish, and the transactions in the spot market was light. As of October 10, the social inventory of lead ingots across Shanghai, Guangdong, Zhejiang, Jiangsu and Tianjin was 66,000 mt, flat from September 30 and down 11,700 mt from September 26. The LME lead fell sharply yesterday, but still remained high and volatile. It is expected that the SHFE 2211 lead contract may fluctuate at a high level. The market should pay attention to the coming delivery of SHFE 2210 contract and the impact of the pandemic on the production of secondary lead enterprises in Anhui and Hunan.