Future Attention Should be Paid to the Price Spread Between Primary Lead and Secondary Refined Lead and the Pandemic

SHANGHAI, Dec 19 (SMM) - As of December 19, the social inventory of lead ingots across Shanghai, Guangdong, Zhejiang, Jiangsu and Tianjin was 58,900 mt, up 300 mt from December 16 and 8,100 mt from December 12.

According to research, the delivery of SHFE 2212 lead contract finished last week and the deliverable goods arrived at the social warehouse, which led to a significant increase in the overall social inventory of lead ingots.The inventory still increased until Monday. Recently, lead prices declined. Downstream companies still had demand for stockpiling. At the same time, secondary lead smelters in Anhui and Jiangsu increased the production. As the supply and demand increased, the social inventory of lead ingots is unlikely to decline rapidly. But the market players also should pay attention to the narrowed price difference between primary lead and secondary refined lead. As of Monday (December 19), the secondary refined lead prices were in discounts of 150-100 yuan/mt against SMM 1# lead (ex-factory). As such, some enterprises may intend to purchase refined lead and the social inventory of lead ingots may fall slightly. In addition, as the domestic pandemic prevention and control policy was relaxed, the infection rate rose. In the future, SMM will pay future attention to the social inventory in Shanghai, Guangdong and Tianjin.