Lead prices fluctuate at highs, be wary of risks from US tariff policies [Lead futures brief comment]

SMM, July 11, 2025

The most-traded SHFE lead 2508 contract opened at 17,120 yuan/mt today. After opening, it fluctuated rangebound. Due to the poor performance of spot cargoes, it plunged to a low of 17,015 yuan/mt in the afternoon. It rebounded and made up for losses in the closing session, finally closing at 17,075 yuan/mt, down 0.9%, with an open interest of 53,479. Recently, maintenance and new capacity commissioning have coexisted in primary lead and secondary lead smelters. Meanwhile, lead prices have fluctuated at highs. Suppliers have mostly sold at discounts. Cargoes in Jiangsu, Zhejiang, and Shanghai warehouses were quoted at premiums of -80 to -20 yuan/mt against the SHFE lead 2508 contract. However, downstream enterprises have scattered demand, and their rigid demand is more inclined to purchase cargoes self-picked up from production sites at smelters. Some downstream enterprises have a strong wait-and-see sentiment due to fear of high prices and have reduced purchases. As a result, social inventory of lead ingots has increased. In addition, the SHFE lead 2507 contract is approaching delivery next week. Considering that the current spread between futures and spot prices of lead exceeds 200 yuan/mt, suppliers intend to transfer inventory to delivery warehouses, which is also one of the main factors driving the increase in social inventory of lead ingots. The accumulation of inventory may drag lead prices to pull back relatively.

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