Futures:
Overnight, the LME lead 3M contract opened at $1,991/mt, edged down slightly during Asian hours before fluctuating higher, hit a high of $2,001.5/mt in the European session, after which overhead selling pressure was released and the market quickly turned downward, dipping to $1,975/mt during the session. Prices corrected slightly in late trading and finally settled at $1,981/mt, down $7.5/mt or 0.38%.
Overnight, the SHFE lead 2607 contract opened at 16,190 yuan/mt. Early in the session, prices saw a slight correction, then short-term buying pushed prices slightly higher to a session high of 16,195 yuan/mt. After the high, bulls lacked follow-through, bears gradually took control, and futures fluctuated downward, with prices moving lower in steps to 16,075 yuan/mt, finally settling at 16,095 yuan/mt, posting a five-day losing streak, down 75 yuan/mt or 0.46%.
On the macro front:
The U.S. military launched strikes against Iran over a helicopter incident, and Iran said it would respond resolutely. Trump: May participate in rebuilding Iran, but wants half the oil. Vance: A deal could be reached in the near term, but “definitely” before the midterm elections. U.S. media disclosed four major topics in U.S.-Iran nuclear talks. The EU plans to unveil its 21st round of sanctions against Russia. According to Nikkei: The Bank of Japan plans to raise rates to 1% at its June meeting. China's goods trade imports and exports grew 15.3% in the first five months. The U.S. added Alibaba, BYD, and others to its “military-related” list. Foreign Ministry: Urges the U.S. to stop unreasonable suppression of Chinese companies.
Spot Fundamentals:
In the morning, SHFE lead tumbled sharply, nearing the 16,000 mark. Suppliers diverged in their selling strategies, with a few still offering at discounts while most narrowed their discount quotes. In particular, smelters showed strong reluctance to sell at low prices, with some only selling under long-term contracts. Mainstream primary lead smelters offered electrolytic lead at parity with the SMM #1 lead average price EXW. In the secondary lead sector, smelters were reluctant to sell at low prices, with most halting shipments. Some secondary refined lead was offered at premiums of 0-50 yuan/mt over SMM #1 lead EXW, resulting in an inverted relationship with primary lead. Downstream enterprises’ rigid demand favored the primary lead market, mainly sourcing cargoes self-picked up from production sites. The market saw both wait-and-see sentiment and dip-buying.
Inventory: As of June 9, LME lead inventory decreased by 1,200 mt to 308,050 mt. As of June 8, total social inventory of SMM lead ingots across five regions stood at 64,700 mt, down 2,100 mt from June 1 and down 2,400 mt from June 4.
Today's Lead Price Forecast:
Demand side, end-use consumption is weak, peak-season recovery fell short of expectations, and downstream stockpiling remains cautious. On the lead ingot inventory front, destocking has been weak and has gradually stabilized, while expectations of inventory buildup are intensifying. On the sentiment front, the most-traded SHFE lead contract has posted five consecutive losses, with short positions gradually increasing and bearish sentiment gaining the upper hand in the short term. However, amid the persistent decline in lead prices, secondary lead smelters, facing losses, are holding prices firm and holding back from selling. Coupled with cost support from scrap batteries below, the downside room for lead prices finds some phased support.
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![SHFE and LME Retreat After Rapid Rise, Lead Prices Continue to Weaken [SMM Lead Morning News]](https://imgqn.smm.cn/usercenter/TmYox20251217171721.jpeg)
