SMM December 16 news:
The most-traded SHFE lead 2601 contract opened lower with a gap at 16,870 yuan/mt in the day. After briefly rising above the daily average line in early trading, it fluctuated between 16,840 yuan/mt and 16,910 yuan/mt. However, due to long position liquidation and pressure from falling LME lead prices, SHFE lead fluctuated downward in the afternoon and moved sideways before closing, ending at 16,825 yuan/mt, down 245 yuan/mt or 1.44%. It formed a large bearish candlestick with a bare head.
Currently, some primary lead smelters have not resumed production after maintenance, leading to a decline in primary lead output compared with the same period last month. Trading in the secondary lead market is sluggish: as it is the off-season for battery retirement, supply was already tight. Coupled with the sharp drop in SHFE lead prices, smelters lowered raw material offers, causing suppliers to generally hold back from selling, and reducing raw material arrivals at smelters. At the same time, downstream battery enterprises are bearish on the outlook and have strong sentiment for pushing for lower prices, mostly adopting a wait-and-see approach. SHFE lead is expected to fluctuate at lows in the short term, with future market attention on cost support from tightening raw material supply.
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