Supply Increase Expands Spot-Futures Spread; Lead Ingot Social Inventory Rises to 70,000 mt [SMM Lead Ingot Social Inventory]

SMM March 3 News: According to SMM, as of March 3, the total social inventory of lead ingots in five major regions tracked by SMM reached 70,200 mt, an increase of 10,300 mt compared to February 24 and an increase of 7,200 mt compared to February 27, hitting a three-and-a-half-month high. Recently, primary lead smelters in regions such as Hunan and Henan resumed production after maintenance, leading to a temporary increase in supply. The resumption of production and the commissioning of new capacity at secondary lead enterprises have further eased overall market supply. During this period, the spread between futures and spot prices for lead remained significant. Quotations for primary lead in major production areas against the SHFE lead 2504 contract were at a discount of 250-200 yuan/mt ex-factory. Suppliers maintained their willingness to transfer to delivery warehouses, resulting in lead ingots continuing to move from in-plant inventory to social warehouses. Additionally, entering March, the trend of simultaneous increases in supply and demand for lead ingots persisted. With the delivery of the SHFE lead 2503 contract approaching and the commissioning of new secondary lead capacity, there remains room for further accumulation in social inventory of lead ingots.