Frequent Environmental Protection Incidents on the Lead Ingot Supply Side Drive Downstream to Consume Social Inventory [SMM Survey]

SMM, January 6: According to SMM, as of January 6, the total social inventory of lead ingots across five regions monitored by SMM stood at 48,200 mt, down by 4,900 mt compared to December 30 and by 4,600 mt compared to January 2. Last Thursday (January 2, 2025), Henan and Anhui regions successively issued orange smog alerts, which imposed varying degrees of restrictions on the production and transportation of primary and secondary lead smelting enterprises. In Henan, the restrictions mainly targeted vehicle transportation, while in Anhui, both production cuts or suspensions at smelting enterprises and vehicle traffic restrictions coexisted, leading to constrained lead ingot supply and reduced circulating goods. Meanwhile, downstream enterprises are currently in the customary pre-Chinese New Year inventory stocking period. Some enterprises are purchasing as needed, and with reduced supply from major lead ingot production areas, downstream enterprises have turned to consuming lead ingots from nearby warehouses, resulting in a larger decline in social inventory. Currently, the smog alert in Henan has been lifted, and attention will shift to the production dynamics of enterprises in Anhui. At the same time, the expectation of pre-holiday inventory stocking by downstream enterprises remains, and the social inventory of lead ingots may continue to decline.