Transportation Recovery Combined With Downstream Purchases Leads to Decline in Primary Lead Smelter Inventory [SMM Primary Lead Inventory Weekly Review]

SMM reported on January 3 that, as of January 10, the in-plant inventory of primary lead from major delivery brands stood at 3,100 mt, down by 3,500 mt compared to January 3. It is reported that this week, the smog alert in Henan Province was lifted, and vehicle transportation returned to normal. Meanwhile, supported by the Chinese New Year holiday, primary lead smelters actively shipped goods, leading to a rapid decline in spot premiums. As of January 10, spot order quotations were at premiums of 0-50 yuan/mt ex-factory against the SMM 1# lead average price. In contrast, secondary refined lead quotations were at premiums of 50-100 yuan/mt ex-factory against the SMM 1# lead average price. Downstream enterprises made purchases as needed at lower prices, resulting in a decrease in smelters' in-plant inventory. However, with the Chinese New Year holiday approaching, the destocking of primary lead smelters is expected to reverse into an inventory increase as downstream enterprises go on holiday and logistics operations halt.