Lead prices show a fluctuating trend of holding up well in the short term. Stay vigilant for changes in secondary lead supply in the following period [Brief Commentary on Lead Futures].

SMM, June 17, 2025

This week, the SHFE lead 2506 contract was delivered. The social inventory of lead ingots continued to increase, with the total social inventory of lead ingots in the five regions tracked by SMM reaching 56,400 mt. On the day, the most-traded SHFE lead 2507 contract opened at 16,965 yuan/mt. As bulls reduced their positions, the SHFE lead price plunged at the beginning of the session, oscillating around the 16,900 yuan/mt level during the day. It fell to a low of 16,855 yuan/mt in the late session and closed at 16,860 yuan/mt, down 0.71%, with an open interest of 41,457 lots.

In early June, secondary lead smelters significantly reduced or halted production. The rigid demand from downstream enterprises shifted to the primary lead market, leading to a decline in the in-plant inventory of primary lead smelters. Spot transactions changed from trading at a discount (against the SMM 1# lead average price) last month to trading at a premium this month. Most of the supply from primary lead smelters directly flowed into the consumer market, which may support a fluctuating trend of stronger lead prices. It is also worth noting that primary lead smelters in north and south-west China entered maintenance this week, and supply is expected to tighten further. However, after the rise in lead prices, losses for secondary lead smelters have been mitigated, and some secondary lead smelters intend to resume production. We need to be vigilant about the impact of the expected release of secondary lead supply on lead prices in the future.

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