Nonferrous metals generally fell overnight, while relatively healthy domestic fundamentals keep lead prices at highs. [SMM Lead Morning Meeting Minutes]

Futures:

Overnight, LME lead opened at $2,004/mt, hovered around the daily moving average during the Asian session, fluctuated downward to a low of $1,995/mt during the European session, then rebounded to a high of $2,014.5/mt, and finally closed at $2,005/mt after minor consolidation, down $1.5/mt, a decrease of 0.07%. Overnight, the most-traded SHFE lead contract opened at 17,095 yuan/mt, initially fell to a low of 17,055 yuan/mt, then rebounded to near the daily moving average, and finally closed at 17,080 yuan/mt, unchanged, a change of 0.00%.

On the macro front: On Wednesday US Eastern Time, after the US Fed cut interest rates by 25 basis points as expected, Chairman Powell stated that today's rate cut was a risk management decision and there was no need for rapid interest rate adjustments. This implies that the Fed will not enter a sustained rate-cutting cycle, leading to a cooling of market sentiment, with the Nasdaq index falling over 1% intraday. Domestically, China's fiscal revenue from January to August increased YoY. The State-owned Assets Supervision and Administration Commission reported that since the "14th Five-Year Plan," the total assets of central state-owned enterprises grew from less than 70 trillion yuan to over 90 trillion yuan, and total profits increased from 1.9 trillion yuan to 2.6 trillion yuan, with average annual growth rates of 7.3% and 8.3%, respectively.

Spot fundamentals:

In the Shanghai market, Chihong and Honglu lead were quoted at parity against the SHFE lead 2510 contract; in the Jiangsu-Zhejiang market, JCC and Jijin lead were quoted at parity against the SHFE lead 2510 contract. SHFE lead fluctuated and pulled back, and due to limited circulating cargoes, suppliers refused to budge on prices for shipments, while downstream enterprises purchased as needed, with some negotiating for larger discounts, leading to sluggish transactions for warehouse cargoes in the Jiangsu-Zhejiang-Shanghai region. Additionally, mainstream electrolytic lead producers' quotations for cargoes self-picked up from production sites ranged from discounts of 70 yuan/mt to premiums of 70 yuan/mt against the SMM #1 lead average price ex-works. For secondary lead, regional supply disparities resulted in significant price differences, with secondary refined lead quotations ranging from discounts of 150 yuan/mt to premiums of 50 yuan/mt against the SMM #1 lead average price ex-works, and a few enterprises even held back goods awaiting price increases.

Inventory side: As of September 17, LME lead inventory increased by 2,500 mt to 225,350 mt; as of September 15, the total social inventory of lead ingots across five regions tracked by SMM reached 68,900 mt, up 1,200 mt from September 8 and up 1,900 mt from September 11.

Today's lead price forecast:

Fundamentals side, refined lead supply has not recovered this week, and raw material support continues to underpin lead prices. A primary lead smelter in Henan underwent maintenance and production cuts for crude lead, but electrolytic lead production has not been simultaneously reduced; secondary refined lead is expected to gradually recover by the end of September. Subsequent attention should be paid to the supplementation of raw material supply for secondary refined lead by imported crude lead. Downstream consumption, the National Day holiday is expected to see downstream plants shut down for 3-5 days, with pre-holiday stockpiling and essential restocking continuing. In the spot market, social inventory will gradually flow out after this delivery cycle. The lead market's fundamentals provide moderate support, and lead prices may continue to fluctuate at highs in the short term.

Data source statement: Except for public information, other data are processed by SMM based on public information, market communication, and SMM's internal database model, for reference only and not as decision-making advice.