Lead social stocks extend declines on slow resumption of secondary smelters

SHANGHAI, Aug 16 (SMM) – Inventories of refined lead in China, including primary and secondary materials, continued to decline this week as recovery at secondary smelters remained slow after environmental curbs. 

SMM data showed that lead social inventories across Shanghai, Guangdong, Zhejiang, Jiangsu and Tianjin fell some 1,900 mt from a week ago to stand at 39,000 mt as of Friday August 16, after they lost 2,500 mt in the previous week.

Limited supply in Anhui and Jiangxi provinces kept offers of secondary refined lead at a discount of 50 yuan/mt to flat over the average prices of SMM #1 lead at the start of this week. This drove downstream consumers to primary lead, weighing on inventories in Jiangsu and Zhejiang. 

In Henan province, equipment failure caused by torrential rainfall disrupted local production. Smaller shipments from smelters to warehouses failed to offset the decline in stocks from downstream consumption. 

SMM expects social inventories of lead in China to rebound next week as smelters in Guizhou and Jiangxi provinces reopen on eased environmental impact.