Social inventory of lead ingots continues to increase, and lead prices still face downward pressure [Brief Commentary on Lead Futures]

SMM, May 29, 2025

The most-traded SHFE lead 2507 contract opened at 16,795 yuan/mt during the day. After briefly touching a high of 16,825 yuan/mt in the early session, it fluctuated downward. It slightly rebounded towards the end of the session, closing at 16,750 yuan/mt, up 0.27%, with an open interest of 45,996. According to SMM, as of May 29, the total social inventory of lead ingots across five locations reached 49,400 mt, an increase of 6,000 mt from May 26. With the Dragon Boat Festival holiday approaching, some lead-acid battery enterprises plan to take a 1-3 day holiday. Downstream enterprises showed weak purchasing enthusiasm before the holiday, leading to a continuous accumulation of social inventory of lead ingots, which dragged down lead prices. As there is no prospect of a price drop for scrap batteries, the losses of secondary lead smelters have widened again, dampening their enthusiasm for production and shipments. The price of secondary refined lead has inverted against that of primary lead, and the cost support of secondary lead remains effective. With bullish and bearish factors intertwined, lead prices may continue to consolidate in the short term.

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