Social Inventory of Lead Ingots Declines amid Downstream Restocking Demand

SHANGHAI, Feb 3 (SMM) - As of February 3, the social inventory of lead ingots across Shanghai, Guangdong, Zhejiang, Jiangsu and Tianjin was 56,500 mt, up 100 mt from January 20 but down 2,400 mt from January 30.

According to research, the downstream enterprises took longer vacations during the CNY holiday. After the holiday, smelters actively delivered goods to the warehouse in the major consumption areas, which led to the increasing social inventory at the beginning of the week. Lead prices rose to nearly 15,000 yuan/mt after falling. Coupled with the high costs, secondary lead smelters were unwilling to sell at low prices and thus the market supply of secondary lead was limited. In addition, the retail transactions were thin. However, with the production resumption of downstream enterprises and the recovery of spot market, the lead ingot inventory in major consumption areas declined. Next week, the production of upstream and downstream enterprises will further resume and the lead ingot inventory reserved before the holiday will be basically exhausted. The social inventory will decline at the beginning of next week due to downstream restocking demand. In the second half of next week, the market need to pay attention to the delivery of SHFE 2302 lead contract.