SMM, May 11: The most-traded SHFE lead 2606 contract opened at 16,705 yuan/mt intraday. From the early session to mid-session, SHFE lead prices moved sideways within the range of 16,680-16,730 yuan/mt. Affected by relatively loose primary lead supply coupled with weak downstream consumption, lead prices pulled back under pressure near the end of the session, hitting a low of 16,655 yuan/mt, and finally closed at 16,675 yuan/mt, down 35 yuan/mt or 0.21%. Supply side, production cuts at secondary lead enterprises led to regional tightness in lead ingot supply, while primary lead production remained stable with a slight increase, resulting in relatively loose overall supply. Bullish and bearish factors were intertwined on the supply side. Consumption side, the off-season trend in the lead-acid battery market remained unchanged, but with the holiday factor removed, downstream enterprises will resume purchasing as needed. SMM expects lead prices to maintain a fluctuating trend in the doldrums in the short term. Data source disclaimer: Data other than public information is derived from public information, market communication, and SMM's internal database models, processed by SMM for reference only and does not constitute decision-making advice.

SMM May 11: Last Friday, LME lead opened at $1,974/mt, fluctuated downward during the Asian session to a low of $1,958/mt. As tight supply of lead ingots in the Southeast Asian market persisted, providing strong support for lead prices, it rebounded during the European session, touching a high of $1,979/mt before closing at $1,977.5/mt, down 0.99%. Last Friday evening, the most-traded SHFE lead 2606 contract opened high at 16,740 yuan/mt. Due to weak consumption in the spot market, lead prices were in the doldrums, hitting a low of 16,665 yuan/mt before closing at 16,705 yuan/mt, down 0.03%, forming a small bearish candlestick with no upper or lower shadows. Consumption side, the lead-acid battery market remained in the off-season, but with the holiday factor removed, downstream enterprises will resume purchasing as needed. Supply side, secondary lead enterprises cut production, and regional supply of lead ingots was tight, while primary lead production was stable to slightly higher with relatively ample supply. This week, attention should be paid to the impact of delivery on circulating supplies. Lead prices are expected to have limited discounts (against SMM #1 lead). Data source disclaimer: Data other than public information is derived from public information, market communication, and SMM's internal database models, processed by SMM for reference only and does not constitute decision-making advice.

SMM May 8 update: The most-traded SHFE lead 2606 contract opened at 16,770 yuan/mt intraday. At the beginning of the session, SHFE lead prices moved sideways within the range of 16,750-16,785 yuan/mt. Subsequently, dragged down by lead ingot inventory buildup, prices fluctuated downward, hitting an intraday low of 16,610 yuan/mt. Prices rebounded slightly toward the close, ultimately settling at 16,710 yuan/mt, down 110 yuan/mt or 0.65%, recording a small bearish candlestick. Sentiment side, geopolitical tensions outside China resurfaced, tightening the macro atmosphere and driving non-ferrous metals overall under pressure to pull back. Fundamentals side, production cuts and shutdowns at secondary lead smelters expanded in scope, but the lead-acid battery industry entered the traditional consumption off-season, with supply and demand weakening simultaneously. Lead ingot inventory continued to accumulate after the holiday, making it difficult to provide effective support for lead prices. In the short term, lead prices are expected to continue their pullback, giving back part of the earlier gains. Data source disclaimer: Data other than public information is derived from public information, market communication, and SMM's internal database models, processed by SMM for reference only and does not constitute decision-making advice.

SMM May 8 update: This week, SMM #1 lead ingot prices rose before fluctuating downward, and secondary refined lead premiums converged from wide discounts toward parity. At the beginning of the week, smelter quotes were somewhat divergent, generally ranging from a discount of 0-75 yuan/mt, with downstream purchasing on demand and trading improving. Mid-week, lead prices pulled back, and quote divergence widened to a range of discount 75 yuan/mt to premium 50 yuan/mt, with spot order trading turning sluggish. At the weekend, smelters held prices firm, narrowing quotes to near parity, with downstream mostly adopting a wait-and-see approach and sluggish transactions. Currently, both supply and demand were weak, and premiums are expected to move sideways within the range of discount 75 to premium 50 yuan/mt next week. Affected by pressure on finished lead profits and rising scrap battery raw material costs, smelter losses intensified: as of May 8, large enterprises posted losses of 141 yuan/mt, and small and medium-sized enterprises posted losses of 345 yuan/mt. Although smelter production cuts and shutdowns have increased, the tight raw material situation remains unchanged, and with costs staying elevated, smelter losses are expected to see little significant relief.

Next week, key macroeconomic data releases include China's April CPI YoY, US April non-seasonally adjusted CPI YoY, and US April retail sales MoM. Additionally, US-Iran peace talks have been fraught with twists and turns—Iranian media claimed the US violated the ceasefire agreement, Iranian armed forces struck US warships, and talks are currently stalled, posing significant macro uncertainty risks. LME lead side, ex-China lead ingot inventory continued to decline, while the LME Cash-3M spread maintained a slight contango, with another "one-day" backwardation structure appearing during the week. Combined with the persistently tight spot market supply in Southeast Asia, LME lead is expected to hold up well. Furthermore, uncertainty surrounding ex-China geopolitical factors remains high, and their market impact warrants continued attention. LME lead is expected to trade within $1,950-2,000/mt next week. SHFE lead side, next week the SHFE lead 2605 contract enters delivery, with more suppliers shipping to delivery warehouses. Lead ingots will transfer from factory warehouses to social warehouses, and the continued buildup in visible lead ingot inventory will keep dragging on lead prices. Meanwhile, concentrated production cuts and shutdowns among secondary lead enterprises have become the main driver of supply reduction this month. Additionally, the closure of the import window and secondary lead losses provide price support. After delivery-related factors are resolved, lead prices will need new catalysts to determine direction. The most-traded SHFE lead contract is expected to trade within 16,550-16,950 yuan/mt next week. Spot price forecast: 16,450-16,650 yuan/mt. Consumption side, the lead-acid battery market remains in off-season mode, but with the holiday factor removed, downstream enterprises are expected to resume purchasing as needed. Supply side, secondary lead enterprises cut production, leading to regionally tight lead ingot supply, while primary lead production remained stable to slightly higher with relatively ample supply. Next week, attention should be paid to the impact of delivery on circulating supply. Lead prices are unlikely to see significant discounts (vs. SMM #1 lead). .

After the holiday, lead-acid battery enterprises gradually resumed production. However, the off-season trend in the battery market remained unchanged, and downstream enterprises were generally in a state of production cuts, so post-holiday restocking demand for lead ingots was relatively limited. Meanwhile, lead prices trended stronger this week, with SHFE lead briefly touching the 17,000 mark, which discouraged some restocking demand, and spot market transactions were sluggish. In addition, in the battery wholesale market, dealers saw limited inventory digestion during the Labour Day holiday, and there was no significant restocking demand after the holiday either.