Environmental Protection and Maintenance Affect Supply, Social Inventory of Lead Ingots Continues to Decline [SMM Survey]

According to an SMM survey, as of November 28, the total social inventory of lead ingots in five regions surveyed by SMM decreased to 58,000 mt, down 6,400 mt compared to November 21 and down 5,300 mt compared to November 25.

According to the survey, this week, the production of secondary lead smelting enterprises in Hebei and Anhui has not fully recovered after reductions, while primary lead smelting enterprises in Jiangxi and Guangdong have entered maintenance, further tightening the supply of lead ingots. This week, lead prices fluctuated upward. In the first half of the week, downstream enterprises' procurement was moderate, and lead ingot inventories continued to be consumed. However, in the latter half of the week, lead prices continued to rise, with the most-traded SHFE lead contract once approaching 17,500 yuan/mt. Downstream enterprises generally adopted a wait-and-see attitude, temporarily slowing down their procurement activities, and the destocking speed of social inventory of lead ingots slowed compared to last week. Additionally, with the rise in lead prices, the profit margins of secondary lead have improved. Apart from the secondary lead enterprises planning maintenance in early December, we also need to pay attention to the potential increase in production enthusiasm among other secondary lead enterprises due to improved profitability.