The market is influenced by a mix of bullish and bearish factors, and lead prices continue to fluctuate rangebound. [SMM Lead Morning Meeting Minutes]

Futures:

Overnight, LME lead opened at $1,986.5/mt, and after the opening, it fluctuated rangebound between $1,985-1,990/mt. After entering the European trading session, the center of LME lead's movement shifted downward, approaching $1,980/mt. Later, due to a decline in lead inventory and a drop in the US dollar index, LME lead reversed its trend and rebounded, briefly nearing the $2,000/mt mark, but ultimately failed to break through, closing at $1,995.5/mt with a 0.35% increase.

Overnight, the most-traded SHFE lead 2510 contract opened at 16,860 yuan/mt. Affected by the accumulation of lead warrant inventory, SHFE lead initially performed weaker than during the day. Subsequently, SHFE lead gradually fluctuated upward, maintaining its recent box-shaped fluctuation pattern, and finally closed at 16,900 yuan/mt, up 0.24%. Open interest stood at 49,603 lots, unchanged from the previous trading day.

On the macro front:

The State Council announced comprehensive reform pilots for market-based allocation of factors in 10 regions, including the Beijing city sub-center, key cities in southern Jiangsu, Hangzhou, Ningbo, Wenzhou, and the Hefei metropolitan area. China's Ministry of Commerce stated that it is closely monitoring Mexico's tariff movements and will take necessary measures based on actual circumstances. US inflation was largely in line with expectations, with the August core CPI up 3.1% YoY and 0.3% MoM, matching Wall Street forecasts and July figures; the number of initial jobless claims in the US last week unexpectedly rose to 263,000, reaching a nearly four-year high.

In the spot lead market yesterday, as SHFE lead fluctuated upward, suppliers actively quoted and sold goods. In the Jiangsu, Zhejiang, Shanghai region, quotations were at a discount of 50-0 yuan/mt against the SHFE 2510 contract. Downstream enterprises, wary of high prices, showed less enthusiasm in inquiries compared to the previous day. During this period, electrolytic lead cargoes self-picked up from production sites in South China were still relatively low, with mainstream origin quotations ranging from a 50 yuan/mt discount to a 70 yuan/mt premium over the SMM #1 lead average price. For secondary lead, smelters followed the market, with secondary refined lead quotations ranging from a 50 yuan/mt discount to a 30 yuan/mt premium over the SMM #1 lead average price.

Inventory: As of September 11, LME lead inventory decreased by 4,375 mt to 232,625 mt. The total social inventory of lead ingots in five locations, as tracked by SMM, reached 67,000 mt, an increase of 900 mt from September 4, and a decrease of more than 600 mt from September 8.

Today's lead price forecast:

Recently, both primary and secondary lead smelters have undergone maintenance, leading to regional supply differences in the spot market. With downstream enterprises purchasing as needed, the spot trading activity in North China and Central China has relatively improved, while the South China market, with ample supply, generally trades at a discount. The latest quotations for cargoes self-picked up from production sites are at a 50-0 yuan/mt discount against the SMM #1 lead average price. Meanwhile, many smelters in Anhui, the largest secondary lead production region, underwent maintenance, and a few downstream enterprises began sourcing from warehouses, leading to a decline in inventory at some social warehouses. Additionally, with only two business days remaining until the delivery of the SHFE lead 2510 contract, some goods intended for transfer to delivery warehouses are gradually being moved to delivery warehouses. It is expected that there will still be a certain volume of inventory transfers before the delivery, and lead prices may maintain a consolidating trend.

Data Source Statement: Except for publicly available information, other data are processed by SMM based on public information, market communication, and SMM's internal database model, and are for reference only, not constituting decision-making advice.