It is learned that as of June 18, the in-factory inventory of major primary lead delivery brands stood at 7,100 mt, down 4,000 mt WoW. This week, maintenance activities increased at both primary and secondary lead smelters, tightening the supply of lead ingots. Moreover, as most primary lead enterprises had pre-sold the majority of this week's lead ingot output last week, primary lead smelters maintained low inventories. During the Dragon Boat Festival, many downstream enterprises planned to take holidays, leading to a lack of lead consumption. After the holiday, primary lead smelters may face inventory buildup risks.

[SMM Analysis] Lead Prices Plunge to 27-Month Low – Is the 16,000 "Lifeline" About to Break? SMM June 9 News: As of the close at 11:30 a.m. today, the main SHFE lead contract 2607 was reported at 16,070 yuan/mt, down 305 yuan/mt, a decline of 1.86%, hitting an intraday low of 16,055 yuan/mt, the lowest since March 8, 2024.

[SMM Lead Morning Meeting Minutes: Rising Risk of Lead Ingot Inventory Buildup in China, Lead Prices May Remain in the Doldrums] US Fed official: the current choice is between maintaining patience or raising interest rates, inflation is the top economic risk, and AI has not yet had an impact. Recently, primary lead and secondary lead enterprises in Henan, Anhui, and other regions have resumed production collectively, increasing lead ingot supply...

Next week, key macro data releases will include China's April total retail sales of consumer goods YoY, China's April industrial value-added output of enterprises above designated size YoY, the final reading of the US May University of Michigan Consumer Sentiment Index, and the final reading of the US May one-year inflation rate expectations. In addition, the Fed Chairman transition has been completed, and the monetary policy meeting minutes are set to be released next week. LME lead side, the ex-China mine and smelting sector is going through a turbulent period. Following the accident at a lead-zinc smelter in Kazakhstan in early May, energy supply conflicts in Peru escalated this week. As Peru is a major lead-zinc mining region, this tightened supply expectations on the mine side, supporting lead prices. Meanwhile, spot lead supply tensions in Southeast Asia remained prominent. On one hand, LME lead inventory stood as high as 265,000 mt, mainly consisting of low-grade lead ingots; on the other hand, countries such as Vietnam and Malaysia faced significant lead ingot supply gaps, with spot premiums rising again, mainly due to the scarcity of high-grade lead ingot resources. Overall, LME lead is expected to continue to hold up well. LME lead is expected to trade in the range of $1,975-2,035/mt next week. SHFE lead side, the issue of rising visible inventory of lead ingots caused by short-term deliveries will ease as deliveries conclude. However, the biggest bearish factors currently come from the lead consumption off-season, while secondary lead smelters have shown signs of production resumptions, putting lead prices under pressure. Additionally, the lead ingot import window fully closed this week, and given the regional tight supply of lead ingots outside China, attention should be paid to expectations of the lead ingot export window opening in H2. The most-traded SHFE lead contract is expected to trade in the range of 16,350-16,750 yuan/mt next week. Spot price forecast: 16,300-16,600 yuan/mt. Consumption side, the off-season trend in the lead-acid battery market intensified, with downstream enterprises having limited rigid demand and being relatively cautious in procurement. Supply side, production cuts at secondary lead enterprises improved somewhat, with factories in some regions gradually resuming production. Meanwhile, attention should be paid to the materialization of new maintenance at primary lead enterprises. Spot lead is expected to still trade at a slight discount next week (against SMM #1 lead).

As of May 7, the in-factory inventory of major primary lead delivery brands was 20,300 mt, an increase of 5,300 mt WoW. This week, primary lead smelter production was stable with a slight upward trend. However, due to the Labour Day holiday, downstream enterprises were generally on holiday, leading to a temporary absence of lead consumption. Even though downstream enterprises purchased on demand after the holiday and suppliers transferred lead ingots to delivery warehouses, in-factory inventory of primary lead enterprises still accumulated compared to pre-holiday levels. Next week, as the SHFE lead delivery date approaches, suppliers will continue to transfer lead ingots, and the in-factory inventory pressure on primary lead enterprises is expected to ease going forward.

[SMM Lead Morning Meeting Minutes: Accident at Ex-China Lead Smelter, Lead Prices May Be Boosted in the Short Term] The US Secretary of Defense stated that the ceasefire has not ended, that the "freedom plan" in the Strait of Hormuz is a temporary mission, and that engagement is not being sought. During the Labour Day holiday, downstream enterprises in China went on concentrated holidays, while from April to May, more lead smelters underwent maintenance or production shutdowns...