Downstream Battery Producers See Limited Improvement in Orders; Short-Term Lead Prices May Still Maintain a Fluctuating Trend [SMM Lead Morning Meeting Summary]

Futures Market:

Overnight, LME lead opened at a low of $1,998/mt and fluctuated upward during the Asian session. In the European session, it climbed to a high of $2,024/mt but came under pressure due to the US dollar fluctuating at highs, dipping to a low of $1,988/mt. It slightly rebounded at the close, ending at $2,003.5/mt, up 0.17%.

Overnight, the most-traded SHFE lead 2504 contract opened at 17,160 yuan/mt. With shorts reducing positions, SHFE lead initially touched a high of 17,195 yuan/mt before fluctuating downward to a low of 17,125 yuan/mt. It slightly rebounded at the close, ending at 17,175 yuan/mt, up 0.15%.

》Click to View SMM Lead Spot Historical Prices

Macro:

Trump: A 25% tariff on the EU, covering automobiles and other goods, is expected to be imposed soon. The EU stated it would respond firmly to US tariffs immediately. Trump made conflicting statements regarding the timing of tariffs on Mexico and Canada. The China Financial Regulatory Administration and the National Development and Reform Commission (NDRC) held a seminar on equity investment pilot projects for financial asset investment companies.

Spot Market Fundamentals :

In the Shanghai market, Honglu lead was quoted at 17,075-17,115 yuan/mt, with discounts of 20-0 yuan/mt against the SHFE 2503 contract. In Jiangsu and Zhejiang regions, Yuguang, Jijin, and JCC lead were quoted at 17,075-17,115 yuan/mt, with discounts of 20-0 yuan/mt against the SHFE 2503 contract. The stalemate between bulls and bears in SHFE lead persisted, with prices remaining stagnant. Suppliers quoted prices based on market trends, while in-plant inventory at smelters decreased, and some enterprises suspended cargo pick-up and bulk quotations. Meanwhile, more cargoes flowed into social warehouses, with downstream enterprises showing limited interest in warehouse inventory inquiries. Additionally, secondary lead smelters sold based on market trends, with secondary refined lead ex-factory prices quoted at discounts of 100-0 yuan/mt against the SMM 1# lead average price. Most downstream enterprises received supplier quotations but maintained procurement on a need-only basis. Spot market transactions were sluggish, and discounts in some regions widened compared to the previous day.

Inventory: On February 26, LME lead inventory decreased by 1,750 mt to 217,950 mt. As of February 24, the total social inventory of SMM lead ingots in five regions reached 59,900 mt, up 6,600 mt from February 17 and approximately 400 mt from February 20.

》Click to View SMM Metal Industry Chain Database

Lead Price Forecast:

Recently, several secondary lead smelters reported good arrivals of scrap batteries, with ample raw material inventory. Additionally, some enterprises are expected to increase production in March, suggesting that raw material prices may still fluctuate at highs. Currently, in-plant inventory of lead ingots is gradually depleting, but social inventory remains high. From the perspective of terminal consumption, the post-holiday restocking of e-bike and automotive battery markets by dealers was less than in previous years, with relatively scattered procurement. Orders for producers showed limited improvement. At present, downstream lead ingot procurement remains need-based, with overall consumption performing moderately. In summary, lead prices are likely to maintain a fluctuating trend in the short term.