It was learned that as of March 5, in-factory inventory of primary lead’s major delivery brands stood at 40,600 mt, down 7,700 mt WoW. This week, some primary lead smelters gradually resumed operations after maintenance, and supply increased WoW. Meanwhile, lead consumption recovered, and downstream enterprises purchased as needed, driving smelters’ in-factory inventory lower. In addition, as some downstream enterprises still held a certain amount of pre-holiday lead inventory, replenishment via spot orders was limited, resulting in relatively slow inventory drawdowns at smelters. Market participants should watch subsequent delivery-related inventory transfers by suppliers to help shift pressure away from in-factory inventory.

[SMM Lead Morning Update: US Dollar Index Nears 100; LME Lead Falls to a 10-Month Low] SMM News, March 4: Overnight, LME lead opened at $1,967.5/mt. During the Asian session, LME lead traded relatively steadily, consolidating around $1,970/mt for most of the session......

[SMM Lead Morning Meeting Summary: Coexistence of Energy Supply Pressure and Lead Ingot Inventory Buildup May Lead to Continued Price Consolidation] The escalation of geopolitical tensions in the Middle East, obstruction of major shipping routes, and expectations for rising transportation costs are anticipated to increase pressure on Europe's energy supply. After the domestic holiday, the lead market has experienced severe inventory buildup...

In the spot market this week (February 23-27, 2026), post-holiday refined lead spot market inventories increased as expected. Downstream enterprises gradually resumed operations but showed low enthusiasm for procurement and stockpiling, focusing mainly on long-term contract cargo pick-up or digesting pre-holiday stockpiles. Spot order transactions were generally weak. During the Chinese New Year holiday, most smelters in Hunan underwent maintenance and production cuts, with some producers not yet returning to full capacity this week, leading to tight refined lead supply in certain areas. Suppliers mainly quoted at premiums of 20-30 yuan/mt against the SMM #1 lead average price and were reluctant to sell. In Henan, refined lead supply remained stable; after post-holiday inventory accumulation, stocks were gradually transferred to social warehouses. Suppliers maintained quotations at discounts of 200-150 yuan/mt against the SHFE lead 2603 contract, but transactions at high prices were difficult. Approaching the weekend, some suppliers lowered their discount quotations to facilitate shipments. This week, enterprises across the lead industry chain had not fully resumed operations. Spot market transactions improved slightly compared to pre-holiday levels. After lead consumption recovers in March, the lead market is expected to see increases in both supply and demand.

According to reports, as of February 26, the in-factory inventory of primary lead delivery brands stood at 48,300 mt, an increase of 38,300 mt compared to the pre-holiday period (February 12). During the Chinese New Year, downstream lead enterprises were all on holiday, while some medium and large primary lead smelters maintained normal production. Coupled with logistics suspensions or delays during the holiday, smelters' in-factory inventory rose rapidly. Even though some suppliers transferred inventory to social warehouses after the holiday due to SHFE lead delivery factors, this did not alter the accumulation of inventory at smelters. Additionally, due to the current moderate performance of lead consumption, some primary lead enterprises have extended their maintenance plans. It is worth monitoring whether the recovery in lead consumption, following the basic resumption of production by downstream enterprises next week, will prompt a reduction in smelters' inventory.

Next week, key macroeconomic data releases include the US February ISM Manufacturing PMI, US February ADP employment figures, and China's official February Manufacturing PMI; additionally, the US Fed will release the Beige Book. Meanwhile, overseas geopolitical tensions remain prominent, with uncertainties in US-Iran conflicts fueling strong market risk-off sentiment. On the LME lead front, overseas lead inventory surged by over 50,000 mt during the Chinese New Year holiday. Although stocks declined post-holiday, the high inventory base continued to significantly suppress lead prices, preventing them from breaking above $2,000/mt. Recently, widespread power outages in the US due to winter storms boosted heating demand, driving natural gas prices higher. This, to some extent, increased smelting costs for lead ore and lead ingots, providing short-term support for lead prices. LME lead is expected to trade between $1,950-2,000/mt next week. For SHFE lead, post-holiday inventory buildup in the lead market was severe, with stocks rising simultaneously at smelters and social warehouses, becoming a major drag on prices. Notably, scrap battery prices rose steadily after the holiday, widening losses for secondary lead producers and prompting some smelters to delay resumption plans, which will ease future lead ingot inventory pressure. Meanwhile, as downstream enterprises resume operations, focus will be on lead consumption recovery digesting lead inventories. The most-traded SHFE lead contract is forecast to fluctuate between 16,650-17,000 yuan/mt next week. Spot price forecast: 16,500-17,500 yuan/mt. Next week, lead-acid battery enterprises are expected to largely resume production, and with pre-holiday lead ingot inventories gradually being consumed, rigid demand restocking is anticipated. On the supply side, secondary lead smelters delayed resumption and face significant losses, limiting spot discounts for secondary refined lead. For primary lead, supplies will re-enter the market after delivery next week, and with high smelter inventories, spot discounts may widen.