Social Inventory of Lead Ingots Increased amid the Delivery of SHFE 2208 Contract, Further Attention should be Paid to the Impact of Power Rationing and Exports

SHANGHAI, Aug 19 (SMM) - As of August 19, the social inventory of lead ingots across Shanghai, Guangdong, Zhejiang, Jiangsu and Tianjin was 76,500 mt, down 6,400 mt from last Friday (August 12) and down 1,200 mt from last Monday (August 15).
According to research, due to the high temperature, lead industry was affected by power rationing, including the production of primary lead, secondary lead and lead-acid battery. Therefore, both supply and demand of lead ingots was weak. SHFE 2208 lead contract was delivered this Monday and about 16,000 mt of goods were delivered, hence the social inventory rose sharply. However, as the lead prices fell during the week, downstream enterprises mainly purchased as demand. Therefore, the increase of social inventory slowed down. The power rationing is unlikely to stop next week, hence the supply and demand will be further affected. Meanwhile, market should pay attention to the goods flowing back to the market after the delivery of futures contract, and the expectation of exports. It is expected that the increase of lead ingot social inventory will continue to slow down.