Lead Ingot Inventory Buildup Dragged Down the Market, SHFE Lead Lacked Momentum After Intraday Decline [Lead Futures Brief Review]

SMM, May 12:

The most-traded SHFE lead 2606 contract opened at 16,651 yuan/mt intraday. The market fluctuated downward at the beginning of the session, dipping to a low of 16,500 yuan/mt. Although there was a slight rebound from mid-session to the close, the rebound momentum was weak, dragged down by the approaching delivery date and the continued buildup of lead ingot social inventory. The contract ultimately closed at 16,580 yuan/mt, posting a small bearish candlestick, down 95 yuan/mt or 0.57%. Currently, lead prices continued their downward trend, and smelters' willingness to lower scrap battery purchase prices gradually strengthened, with the cost support from scrap batteries for lead prices expected to weaken further. Meanwhile, suppliers increasingly shipped to delivery warehouses, and lead ingots continued to flow from plant warehouses to social inventory, with visible inventory accumulating continuously, which will continue to suppress the upside room for lead prices going forward. On the other hand, some primary lead smelters remained under maintenance, and the capacity previously planned to resume production has yet to materialize, with bullish and bearish factors intertwining on the supply side. Overall, lead prices are expected to remain in the doldrums in the short term.

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