Primary lead smelters' cargoes self-picked up from production site remain limited, SHFE lead holds up well [SMM Lead Morning Meeting Minutes]

Futures:

Overnight, LME lead opened at $1,972.5/mt, touched a low of $1,971.5/mt during the Asian session and fluctuated upward; entering the European session, LME lead fluctuated upward due to a decline in LME lead inventory and short-covering, and finally closed high at $1,994/mt, up 1.14%.

Overnight, the most-traded SHFE lead 2511 contract opened at 17,130 yuan/mt, touched a low of 17,110 yuan/mt at the beginning of the session, and rose to a high of 17,200 yuan/mt due to long position building, finally closing high at 17,200 yuan/mt, up 0.58%.

On the macro front:

Spot gold broke through last Friday's record high and touched $4,381.4/oz, boosted by expectations that the US Fed will further cut interest rates and sustained safe-haven demand. Australia signed a critical mineral agreement, and Trump said rare earths and critical minerals would be abundant to the point of being overwhelming. White House official Hassett: The government shutdown could end this week; if not, the White House will consider tougher measures. Bond default concerns triggered panic in the Vietnamese market, with the stock index posting its biggest drop since April. China's National Bureau of Statistics (NBS): China's GDP grew 5.2% YoY in the first three quarters. The Ministry of Finance decided to conduct open market operations for treasury bonds in October 2025. The latest loan prime rate (LPR) was left unchanged, with the one-year and five-year LPRs remaining steady. NBS: In September, the selling prices of new commercial residential buildings in first-tier cities fell 0.3% MoM. DCE: Will expand the range of products available for trading by qualified foreign institutional investors and RMB qualified foreign institutional investors. CATL's Q3 net profit was 18.5 billion yuan, up 41% YoY.

:

SHFE lead held up well, while suppliers had divergent views on selling. Some offered cargoes at a discount due to warehouse arrivals, while others refused to budge on prices due to tight supply. Additionally, cargoes of primary lead self-picked up from smelters remained limited. Spot supply was tight in Henan, Jiangxi, Anhui, and Hunan, with smelters refusing to budge on prices and offering at a premium of 50-100 yuan/mt against the SMM #1 lead average price. Meanwhile, vehicle transportation was hindered in north China, prompting downstream enterprises to purchase as needed, with some mainly fulfilling long-term contracts and others purchasing as needed. Inventory: On October 20, LME lead inventory fell by 3,100 mt to 247,300 mt; as of October 20, the total social inventory of lead ingots across five regions surveyed by SMM reached 37,700 mt, up nearly 100 mt from October 16.

Today's Lead Price Forecast:

Recently, maintenance at primary lead smelters in the northern region has not yet ended, while the production resumptions at secondary lead enterprises were slower than expected. The regional tight supply of lead ingots persisted, spot market circulation was limited, and smelters generally refused to budge on prices. In late October, primary lead smelters experienced a mix of maintenance and resumption of operations, leading to persistent regional tightness in lead ingot supply. Meanwhile, as temperatures dropped across various regions, heating had already commenced in some northern areas, potentially triggering air quality control measures again. Attention should be paid to the possible impact of subsequent air quality controls on vehicle transportation and the operational rates of secondary lead smelters. In summary, lead prices may hold up well in the short term.

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.