SHFE Lead Retreated After Rapid Rise and Closed Lower, Weak Demand Weighed on Lead Prices [SHFE Lead Brief Review]

SMM, April 7:

The most-traded SHFE lead 2605 contract opened at 16,755 yuan/mt. Early in the session, SHFE lead prices dropped sharply, hitting a low of 16,635 yuan/mt, before rebounding in a fluctuating manner to touch a high of 16,820 yuan/mt. However, weighed down by weak downstream consumption, lead prices came under pressure and pulled back again. During the afternoon session, prices moved sideways within the 16,660-16,690 yuan/mt range, edging slightly higher toward the close, and ultimately settled at 16,730 yuan/mt, posting a bearish candlestick with a decline of 55 yuan/mt, or 0.33%. Supply side, for primary lead, suppliers actively made shipments upon returning from the holiday, with some lowering their quoted discounts. For secondary lead, secondary refined lead had ample circulating supply in the market, and quotes overall weakened today. Consumption side, as lead prices had been at elevated levels recently, downstream buyers generally adopted a wait-and-see approach, reluctant to purchase at high prices, resulting in extremely low market trading activity. Lead prices were capped by weak downstream consumption, limiting upward momentum, while raw material costs provided rigid support on the downside. Amid the tug-of-war between longs and shorts, lead prices were expected to maintain a fluctuating trend in the near term.

Data source statement: Data other than publicly available information was derived by SMM based on publicly available information, market communication, and SMM's internal database model, for reference only and not as decision-making advice.