Imported Lead Concentrate Arrived at Ports Concentratedly, Smelter Raw Material Inventory Diverged [SMM Analysis]

In Q3 2024, lead concentrate imports turned profitable, and the lead concentrate trade market gradually became active. From September to October, lead concentrate orders from the US, Australia, and other regions arrived in bulk. The cumulative lead concentrate imports in 2024 reached 1.0495 million mt (metal content), up 4.78% YoY. Additionally, silver concentrate imports in October were 134,000 mt, down 23.66% MoM and 1.34% YoY. The import pace of silver concentrate in October did not align with that of lead concentrate.

By country, the US, Russia, and Australia remained the main sources of lead concentrate imports in October, with the total imports from these three countries accounting for 61%.

According to the SMM survey, the period from August to October is the regular cycle for smelters to order raw materials for winter stockpiling. Lead concentrate orders arrived in bulk from September to October, and smelter inventories gradually increased. Several smelters indicated that by late November, they had completed the stockpiling plans for 2-3 months of raw materials. The winter stockpiling process for 2024 is nearing its end, and subsequent raw material procurement will return to just-in-time restocking. Due to differences in the proportion of imported ore procurement and winter stockpiling habits between northern and southern domestic smelters, the raw material inventory disparity among primary lead smelters has significantly widened. Some smelters in Hunan, Guangxi, and Yunnan, which did not order imported ore, reported that year-end raw material supply is again tight, with raw material inventories still maintaining 20-30 days. In some regions, the RC for silver-bearing crude lead has slightly decreased.

In November, macro disturbances had a greater impact on LME lead. The decline in SHFE lead was less than that in LME lead. The profitability of lead concentrate imports only saw a slight recovery, and the import window for lead concentrate has not yet opened. In the lead ore trade market, the pb60% TC quotation for low-silver lead ore slightly rebounded from -$30/mt to -$20/mt, but high-silver lead ore remained scarce, and its pb60% TC quotation did not soften.