Lead Prices Continued to Fluctuate; Secondary Refined Lead Profits Declined but Quotes Remained Firm [SMM Lead Morning Comment]

Overnight, LME lead opened at $2,044.5/mt. During the Asian session, it briefly touched a high of $2,046/mt before weakening. In the European session, it dipped to $2,020/mt before slightly rebounding, finally closing at $2,027/mt, down $14.5/mt, a decrease of 0.71%.

Overnight, the most-traded SHFE lead 2412 contract opened at 16,745 yuan/mt. Initially dragged down by LME lead, it fluctuated downward before stabilizing near the daily moving average. Before the close, it fell again to a low of 16,675 yuan/mt, ending at 16,685 yuan/mt, down 10 yuan/mt, a decrease of 0.42%.

On the macro side, the US dollar index saw a slight correction, with investors focusing on the US October employment report this week. On the domestic fundamentals side, the spot market supply and demand remained tightly balanced, with downstream operating rates rising. According to SMM survey, secondary lead producers in Anhui, Jiangsu, Hebei, and Henan have reduced production due to environmental protection impacts, leading to a decrease in spot market circulating supply. The price spread between secondary lead and primary lead narrowed, with downstream companies showing a preference for primary lead. Social inventory slightly declined. As the end of October approaches, environmental protection inspections and smog-related production restrictions in relevant regions are expected to end, and attention should be paid to the resumption of smelters.