Futures:
Overnight, LME lead opened at $1,891.5/mt, hitting a high of $1,909/mt in Asian trading hours. Entering European trading hours, bears added positions and LME lead drifted lower, touching a low of $1,857/mt near the close, and finally settled at $1,863.5/mt, down 1.48%.
Overnight, the SHFE lead 2611 contract opened lower with a gap at 16,025 yuan/mt, briefly touched a high of 16,035 yuan/mt in early trading before falling, then dipped to a low of 15,880 yuan/mt near the close, and finally settled at 15,885 yuan/mt, down 1.27%.
On the macro front:
Fed's Waller: Further rate hikes are still needed, but they do not need to be consecutive; Musalem: Further rate hikes may be needed over the next 6 to 9 months. The WTO raised its 2026 global merchandise trade growth forecast from 1.9% to 3.9%. Memory chip price hikes squeezed profits, and Samsung plans to cut phone production by 30%.
The People's Bank of China issued its policy stance on the yuan exchange rate. Commerce Minister Wang Wentao met with European Commission Trade and Economic Security Commissioner Sefcovic in Beijing. Measures for protecting the rights and interests of workers in new forms of employment were released for public comment.
Spot fundamentals:
In Shanghai, Chihong lead was quoted at 16,275-16,385 yuan/mt, at premiums of 60-150 yuan/mt against the SHFE lead 2611 contract. After the holiday, SHFE lead continued to consolidate. Warehouses in Jiangsu, Zhejiang, and Shanghai saw small arrivals, and suppliers quoted in line with the market, selling at premiums. In addition, spot cargoes self-picked up from primary lead smelters increased compared with before the holiday. Supply was ample in south China but remained tight in north China. Mainstream production-area quotations were at premiums of 0-80 yuan/mt against the SMM #1 lead average price ex-works, with some at discounts of 20 yuan/mt. For secondary lead, circulating cargoes in the market were limited, and mainstream production-area secondary refined lead quotations were at premiums of 25-75 yuan/mt against the SMM #1 lead average price ex-works. On the first day after the holiday, downstream enterprises gradually made inquiries and purchases, with moderate buying interest. Compared with the wait-and-see attitude seen after holidays in previous years, overall trading sentiment in the spot market was moderate.
Inventory: On October 8, LME lead inventory decreased by 1,525 mt to 347,875 mt. According to SMM, as of October 8, total social inventory of SMM lead ingots across five regions reached 50,400 mt, down 2,000 mt from September 28 but up 1,800 mt from September 30.
Lead price forecast for today:
After returning from the National Day holiday, downstream lead-acid battery enterprises gradually resumed normal production, and some downstream enterprises restarted purchases, with spot market trading recovering. During the holiday, upstream and downstream enterprises had different holiday schedules, leading to a phased absence of lead consumption. Some suppliers moved lead ingots to social warehouses, and inventories at warehouses in various regions increased to varying degrees. After the holiday, social inventory of lead ingots accumulated as expected. In addition, before the holiday, lead smelters actively pre-sold October supply, and during the holiday, downstream enterprises also picked up goods as needed. Therefore, the post-holiday lead ingot inventory accumulation was limited. Combined with the recovery of downstream purchasing, the subsequent lead ingot inventory growth is expected to be limited, and lead prices will maintain a fluctuating trend.
