Pre-holiday refined lead market saw a dual decline in supply and demand, with lead prices continuing to fluctuate downward. [SMM Lead Morning Meeting Summary]

Futures Market:

Overnight, the most-traded SHFE lead contract opened with a gap at 17,375 yuan/mt, briefly touched a high of 17,400 yuan/mt in early trading, then fell to a low of 17,305 yuan/mt before slightly rebounding to close at 17,360 yuan/mt, down 45 yuan/mt, or 0.26%. Overnight, LME lead opened at $2,013/mt, fluctuated rangebound during the Asian session, and then fluctuated downward during the European session to a low of $1,984/mt, eventually closing at $2,000/mt, down $13/mt, or 0.65%.

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Macro-wise, the US continues to escalate tariff measures, with the "reciprocal tariffs" set to take effect on April 2, intensifying market uncertainty and driving up demand for safe-haven assets. This week, the market focus shifted to the upcoming US non-farm payrolls report, with cautious sentiment prevailing in the domestic commodity market, which generally fluctuated downward. Domestically, according to the National Development and Reform Commission (NDRC), car trade-ins exceeded 1.07 million units from January to February, driving new car sales to 116.5 billion yuan. Domestic passenger vehicle retail sales increased 1.2% YoY, with a significant 26% YoY growth in February.

Spot Fundamentals :

In the Shanghai market, Chihong lead was quoted at premiums of 20-30 yuan/mt against the SHFE 2505 lead contract. In the Jiangsu-Zhejiang region, JCC and Jinde lead were quoted at parity against the SHFE 2505 lead contract. SHFE lead showed a consolidating trend, and due to limited circulating supply, suppliers stood firm on quotes, with some small premium cargoes seeing limited transactions. Meanwhile, ex-factory quotes for primary lead smelter cargoes shifted from premiums to discounts, with mainstream producing areas quoting premiums of 0-100 yuan/mt against the SMM 1# lead average price. Secondary lead smelters expanded discounts, with secondary refined lead quoted at discounts of 100-0 yuan/mt against the SMM 1# lead average price. Downstream enterprises maintained purchasing as needed, with some planning to take a holiday during the Qingming Festival, showing moderate purchasing enthusiasm. Some made purchases as needed before the holiday, leading to a slight improvement in spot transactions.

Inventory-wise: As of April 1, LME lead inventory increased by 250 mt to 232,175 mt. As of March 31, SMM lead ingot social inventory in five regions totaled 72,500 mt, up over 600 mt from March 24 and up 3,300 mt from March 27.

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Today's Lead Price Forecast:

Supply side, constrained by routine maintenance and difficulties in scrap recycling, secondary refined lead production may fall short of expectations. Despite supply-side disruptions in the lead market this week, demand remained weak as the Qingming Festival holiday approached, leading to a continued decline in both supply and demand. Spot market sentiment was cautious, with downstream pre-holiday restocking enthusiasm generally weak. Some companies expected to digest inventory and conduct essential restocking after the holiday, with lead prices likely to continue fluctuating downward before the holiday.