SMM Morning Comment For Lead Market On August 1

SHANGHAI, Aug 1 (SMM) –

On Monday, LME lead opened at $2,156/mt and hit a session high of $2,166/mt at the beginning and then fell to $2,142 /mt, finally closed at $2,164/mt, up 0.42%. Its open interest increased by 1,686 lots to 121,000 lots compared with the previous trading day, and its trading volume decreased by 85 lots to 3,863 lots.

Overnight, the most-traded SHFE lead 2309 contract opened at 15,945 yuan/mt, and initially rose to a high of 15,960 yuan/mt, and then fell to the lowest of 15,925 yuan/mt, finally closed at 15,945 yuan/mt, down 0.16%. Its open interest increased by 1,510 lots to 107,000 lots compared with the previous trading day, and its trading volume decreased by 29,804 lots to 20,134 lots.

On the macro level, we should pay attention to China Caixin manufacturing PMI data for July and the Final Markit manufacturing PMI for July of the United States on August 1. In terms of spot fundamentals, last week, SMM data showed the operating rate of primary lead smelters in the three provinces was 56.16%, a decrease of 0.25 percentage points from the previous week. The operating rate of SMM licensed secondary lead enterprises in the four provinces was 43.88%, which is basically the same as that of the previous week. The weekly operating rate of lead-acid battery enterprises in the five provinces was 65.52%, a decrease of 0.38 percentage points from the previous week. This week, some smelters will be shut down for maintenance, and some will resume production, so the supply of lead ingots will not be much different from last week. The lead price fluctuates at a high level, and the production cost of lead-acid battery enterprises is relatively high. In the market where the expectation of consumption recovery has not yet been fulfilled, it is expected that the price of lead ingots will still fluctuate within a narrow range.