Futures Market:
Overnight, LME lead opened at $1,982/mt. It traded within a narrow range during the Asian session. After dipping to $1,978.5/mt in the European session, it rebounded and recovered losses, reaching a high of $1,995/mt towards the close. It finally closed at $1,993.5/mt, up 0.3%.
Overnight, the most-traded SHFE lead 2507 contract opened higher with a gap at 16,870 yuan/mt. After briefly touching a high of 16,890 yuan/mt at the start of the session, it fluctuated downward. It dipped to a low of 16,840 yuan/mt towards the close and finally settled at 16,855 yuan/mt, up 0.09%.
》Click to view SMM historical spot lead quotes
Macro Aspects:
US CPI data for May came in below expectations across the board, with Trump once again calling for the US Fed to cut interest rates by 100 basis points. Bessent stated that the 90-day tariff suspension period could be extended beyond July 9 as long as there is "good faith." Li Chenggang, China's International Trade Representative of the Ministry of Commerce: China and the US have reached a framework for implementing the consensus reached in the phone call between the two heads of state and the consensus reached in the Geneva talks. What are the next steps for China-US economic and trade consultations? The Ministry of Foreign Affairs responded: Currently, I have no further information to provide. CAAM: From January to May, auto sales in China reached 12.748 million units, with electric four wheeler lead-acid battery scrap accounting for 44%.
SHFE lead maintained high-level consolidation. With delivery approaching, some suppliers were waiting for delivery, and their quoted premiums remained unchanged from yesterday. However, there were differences in the transactions of cargoes self-picked up from primary lead smelters, especially in south China, where transactions were brisk and traded at premiums against the SMM 1# lead average price. In north China, transactions were sluggish. In addition, most secondary lead smelters in east China were in a state of production reduction or suspension. Mainstream ex-factory quotations were at premiums of 0-100 yuan/mt against the SMM 1# lead average price. Limited supply and firm prices led some lead demand to flow into the primary lead market, and spot market transactions improved regionally.
Inventory: On June 11, LME lead inventory decreased by 4,500 mt to 273,525 mt. As of June 9, the total social inventory of lead ingots in five locations tracked by SMM reached 53,900 mt, an increase of 4,500 mt from May 29 and an increase of 4,000 mt from June 3.
》Click to view SMM Metal Industry Chain Database
Today's Lead Price Forecast:
On the supply side, there are currently no signs of further expansion in the production reduction or suspension of secondary lead smelters. Attention should be paid to the impact of maintenance of delivery brand primary lead on supply and lead prices in the middle and late of the month. On the consumption side, mainstream lead-acid battery brands have recently announced plans to raise prices, while other lead-acid battery producers are adopting a wait-and-see attitude. If the market can accept the price increases of mainstream brands, there may be a slight follow-up increase. In the short term, lead prices are expected to hold up well.
