Lead social inventories rebounded on cautious buying 

SHANGHAI, Nov 29 (SMM) – Inventories of lead ingots in China rebounded this week as falling lead prices made downstream consumers cautious about restocking, SMM survey showed. Some downstream mills delayed their year-end purchases. 

SMM data showed that lead social stocks across Shanghai, Guangdong, Zhejiang, Jiangsu and Tianjin rose 1,600 mt from a week earlier to 37,200 mt as of November 29. This came after the inventories ended three consecutive weeks of increase with a 4,500 mt drop last week. 

Downstream buyers still favoured primary lead as ex-work prices of secondary refined lead remained flat against the average prices of SMM 1# lead. 

Traders bought cheap cargoes, and this triggered the transfer of some stockpiles from smelters to social warehouses. Cash-in inclination drove lead smelters to destock, with transactions under long-term contracts accounting for the majority. 

SMM expects social inventories of lead ingots to edge lower next week amid year-end restocking demand. Production at smelters is estimated to stabilise. Changes in the price spread between primary and secondary lead, which affect downstream purchasing decisions, will be closely monitored.