Lead ingot social inventory rose to a two-month high, with attention on downstream pre-holiday restocking actions [SMM survey]

According to the SMM survey, as of September 23, the total social inventory of SMM lead ingots in five regions reached 65,600 mt, an increase of 6,500 mt compared to September 19, and an increase of 15,200 mt compared to September 12.

According to the survey, the maintenance of primary and secondary lead smelters recently concluded, and lead ingot production steadily increased. During the Mid-Autumn Festival, the lead consumption gap caused by downstream enterprises' holidays has not yet been filled, and the social inventory of lead ingots continued to rise. Smelters actively made shipments after the holiday, with some primary lead plants quoting at discounts of 200-180 yuan/mt against the SHFE 2410 contract. Traders bought on dips, and the transfer of smelters' inventory to social warehouses was one of the factors for the increase in social inventory. Additionally, yesterday's lead prices fell further, but battery scrap prices remained high, even rising instead of falling. Secondary refined lead enterprises held firm on prices, with regions like Anhui and Henan seeing secondary refined lead prices surpassing primary lead prices, causing a price inversion. This price spread change may lead downstream enterprises' rigid demand to return to the primary lead sector. Furthermore, this week is the week before the National Day holiday, and downstream enterprises may conventionally conduct pre-holiday restocking. If pre-holiday restocking materializes, the social inventory of lead may potentially shift from rising to falling.