Futures:
Overnight, LME lead opened at $1,892.5/mt, briefly touched a high of $1,895.5/mt in early trading before drifting lower. During the European session, bulls reduced their positions, and LME lead drifted lower, hitting a low of $1,878/mt near the close, and finally settled at $1,881/mt, down 0.37%. Overnight, the most-traded SHFE lead 2608 contract opened at 15,905 yuan/mt, moved sideways around the 15,910 yuan/mt level, reached a high of 15,935 yuan/mt during the session, and finally settled at 15,900 yuan/mt, up 0.03%.
On the macro front:
Fed Governor Waller: Forward guidance is not necessarily better when more is provided, and can be completely omitted if necessary. Inflation risks have now exceeded employment risks. Saudi Arabia cut the August official selling price for Arab Light crude to Asia by $11/bbl, to a discount of $1.5 against the Oman/Dubai average, the largest cut in at least 26 years. The Cyberspace Administration of China has deepened the first phase of the special campaign “Qinglang · Rectifying AI Application Irregularities.” Hong Kong SAR Chief Executive John Lee met with PBOC Governor Pan Gongsheng. The Ministry of Emergency Management upgraded the national geological disaster emergency response for Guangxi to Level 3.
Spot fundamentals:
SHFE lead maintained a fluctuating and consolidating trend. Supply of circulating goods in the Jiangsu, Zhejiang, and Shanghai market relatively increased, and suppliers actively quoted and sold. Meanwhile, EXW quotations of primary lead smelters showed little difference, with offers from mainstream regions quoted at parity with the SMM #1 lead average price EXW, and a small portion at a discount of 20 yuan/mt EXW. For secondary lead, most smelters were in a state of production suspension or had halted shipments. Secondary refined lead was quoted at parity with SMM #1 lead EXW, with a few at a premium of 75 yuan/mt. Downstream enterprises continued to purchase as needed. Due to the off-season factor, rigid demand was relatively limited, and spot market transactions were sluggish.
Inventory: On July 6, LME lead inventory decreased by 875 mt to 292,275 mt. As of July 6, total social inventory of lead ingots in SMM’s five regions was 70,200 mt, down 2,300 mt from July 2.
Lead price forecast for today:
Recently, lead prices continued to be in the doldrums. Downstream enterprises engaged in dip-buying as needed, with cargo pick-ups increasing at some social warehouses, leading to a decline in overall social warehouse inventory. However, it is worth noting that the off-season trend in the lead-acid battery market remains unchanged, limiting rigid demand from downstream enterprises. With the delivery of the SHFE lead 2607 contract approaching, suppliers showed signs of shipping to delivery warehouses and relocating stock, causing some social warehouses to rise for two consecutive weeks. Moreover, both primary lead and secondary lead smelters underwent maintenance this week. With only seven working days until the SHFE lead delivery date and smelter inventories remaining high, we still need to be vigilant about the impact on social inventory and lead prices.
![Spot Market Weakens, Lead Futures in the Doldrums [SMM Lead Morning Brief]](https://imgqn.smm.cn/usercenter/msNEk20251217171722.jpg)
![SHFE lead ends slightly higher intraday, short-term rebound strength needs to watch downstream destocking realization [Lead Futures Brief Review]](https://imgqn.smm.cn/usercenter/xVgcv20251217171721.jpg)
