Downstream enterprises are cautious due to high prices, and trading activity in the lead spot market has declined [SMM Lead Morning Meeting Summary]

Futures:

Overnight, LME lead opened at $1,998/mt, fluctuating rangebound in the Asian session, with a low of $1,997.5/mt. Entering the European session, LME lead fluctuated upward, reaching a high of $2,011/mt, and closed at $2,007/mt, up 0.5%.

Overnight, the most-traded SHFE lead 2509 contract opened at 16,875 yuan/mt, touched a low of 16,850 yuan/mt in the early session, and then fluctuated upward, reaching a high of 16,910 yuan/mt, and closed at 16,885 yuan/mt, up 0.15%.

Macro:

The reciprocal tariff officially took effect. Trump: Billions of dollars will start flowing into the US. EU: The 15% tariff cap will still apply to chip exports to the US. China's General Administration of Customs: In July, imports and exports reached 3.91 trillion yuan, up 6.7%. Among them, exports were 2.31 trillion yuan, up 8%; imports were 1.6 trillion yuan, up 4.8%. The PBOC will conduct a 700 billion yuan outright reverse repo operation today, with a term of three months. The PBOC has increased its gold reserves for the ninth consecutive month, with gold reserves reaching 73.96 million ounces at the end of July, up 60,000 ounces MoM.

:

SHFE lead maintained a high consolidation trend. Suppliers shipped goods at market prices, with discounts basically flat compared to yesterday. Downstream enterprises had a strong wait-and-see sentiment, and their inquiry enthusiasm was low. Meanwhile, the cargoes self-picked up from primary lead smelters were quoted relatively firmly, with discounts of 20 yuan/mt to premiums of 50 yuan/mt against the SMM #1 lead average price, or discounts of 100-50 yuan/mt against the most-traded SHFE lead 2509 contract. For secondary lead, there were significant regional supply differences. Secondary refined lead was quoted at discounts of 50 yuan/mt to premiums of 100 yuan/mt against the SMM #1 lead average price.

Inventory: On August 7, LME lead inventory increased by 800 mt to 269,400 mt. As of August 7, the total social inventory of SMM lead ingots in five regions reached 71,100 mt, a decrease of about 800 mt from August 4.

Today's lead price forecast:

This week, the production of primary lead smelters gradually recovered, while environmental protection inspections were underway in Anhui, limiting the production of some secondary lead enterprises and expanding the regional supply differences of lead ingots. During this period, the discounts of cargoes self-picked up from primary lead smelters narrowed, and some downstream enterprises chose to purchase nearby, leading to a decrease in social warehouses of lead ingots. Recently, lead prices have fluctuated upward, with SHFE lead once approaching the 17,000 yuan/mt threshold. Downstream enterprises were cautious due to high prices and adopted a wait-and-see attitude, resulting in a decline in trading activities in the spot market. Next week, the most-traded SHFE lead 2508 contract will approach delivery, and there may still be some lead ingots transferred to warehouses before delivery. It is expected that the subsequent decline in social inventory of lead ingots may slow down, and attention should be paid to the impact of inventory buildup on lead price trends.

Data source statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market exchanges, and relying on SMM's internal database model. These data are for reference only and do not constitute decision-making advice.