SMM, August 18: Today, offers from smelters and the recycling side in the waste lead-acid battery market held steady. A few smelters raised their purchase offers slightly, but overall price adjustments were limited and the market remained basically stable. Smelter raw material arrivals showed no significant change for the time being but displayed notable regional divergence, with relatively better arrivals in regions with higher purchase prices. Limited by the current thin supply of scrap batteries in circulation, a recycler in North China reported a notable contraction in average daily purchases, from 20-30 mt/day previously to about 7-10 mt/day currently, and the arrival pace was unstable. After lead prices rebounded, the pullback was relatively limited. Downstream wait-and-see sentiment improved slightly from earlier, while rigid demand consumption remained stable but the overall improvement was still limited. Scrap battery prices are expected to move sideways in the short term. Attention will focus on smelters' price adjustment pace and the impact of supply releases from retail outlets on circulation volume.

SMM News on August 18: Overnight, the LME lead 3M contract opened at $1,885.5/mt. After the open, it drifted higher, hitting an early-session high of $1,891.0/mt. It then stayed high and moved sideways within a narrow range, dipping to a low of $1,885.0/mt, and finally closed at $1,885/mt, up $5.5/mt from the previous trading day, a gain of 0.29%. The trading range was $1,885.0-1,891.0/mt, with a fluctuation of $6.0/mt. Overnight, the SHFE lead 2610 contract opened today at 15,880 yuan/mt. After the open, it quickly fell to 15,845 yuan/mt and then rebounded to 15,938 yuan/mt. After moving sideways within a narrow range, it moved sideways in late trading within 15,865 yuan/mt-15,880 yuan/mt, and finally closed at 15,875 yuan/mt, down 75 yuan/mt from the previous trading day’s closing price, a decline of 0.47%. Demand side, as downstream enterprises ended their high-temperature holidays, some enterprises resumed normal production, and routine procurement demand rebounded, easing to some extent the pressure from inventory buildup of lead ingots after delivery. Supply side saw both increases and decreases: maintenance at primary lead enterprises will bring some reduction in supply, and with smelters holding prices firm while selling, the widening of spot lead discounts was limited; as losses at secondary lead enterprises were somewhat repaired, some enterprises resumed production, increasing market circulating supply, and secondary refined lead maintained trading at relatively larger discounts. Overall, lead prices maintained a fluctuating trend.

Futures: Overnight, the LME lead 3M contract opened at $1,885.5/mt. After the open, it drifted higher, hitting an early-session high of $1,891.0/mt. It then stayed high and moved sideways in a narrow range, with a low of $1,885.0/mt, and finally closed at $1,885/mt, up $5.5/mt from the previous trading day, a gain of 0.29%. The trading range was $1,885.0–$1,891.0/mt, with a spread of $6.0/mt. Overnight, the SHFE lead 2610 contract opened at 15,880 yuan/mt. After the open, it quickly fell to 15,845 yuan/mt and then rebounded to 15,938 yuan/mt. After moving sideways in a narrow range, it moved sideways in a narrow range at 15,865–15,880 yuan/mt in late trading, and finally closed at 15,875 yuan/mt, down 75 yuan/mt from the previous trading day’s closing price, a decline of 0.47%. Macro: The 60-day deadline for the US-Iran peace agreement officially expired, and Iran ruled out the possibility of an extension; US President Trump said the US is not currently seeking to extend the memorandum of understanding with Iran, and geopolitical uncertainty in the Middle East intensified. As recent US economic data were weak, the market’s bets on further rate hikes by the US Fed continued to cool. China, the UK, and Japan all reduced their holdings of US Treasuries in June; the US 30-year Treasury yield rose to 5.31%, a 19-year high. Li Qiang chaired the 12th plenary meeting of the State Council, stressing the need to thoroughly implement the CPC Central Committee’s decisions and deployments and strive to accomplish the annual targets and tasks for economic and social development. The National Development and Reform Commission (NDRC) deployed efforts to accelerate the rollout of new-type policy-based financial instruments in 2026 and increase support for private investment projects. China’s National Bureau of Statistics: In July, the value-added industrial output of enterprises above designated size grew by 4.5% YoY in real terms; MoM, the sales prices of newly built commercial residential housing in first-tier cities shifted from a 0.1% increase in the previous month to flat. Spot fundamentals: SHFE lead continued to consolidate on a strong note, and today was the delivery day for the SHFE lead 2608 contract, with relatively few quotations for warrant cargoes. In addition, EXW cargoes self-picked up from primary lead smelters differed between the northern and southern markets; in mainstream producing areas, cargoes were quoted at premiums of 0–50 yuan/mt against the SMM #1 lead average price, ex-works. For secondary lead, smelters sold in line with the market, and discounts in quotations changed relatively little WoW; secondary refined lead was quoted at discounts of 100–0 yuan/mt against the SMM #1 lead average price, ex-works. After returning from the weekend, downstream enterprises gradually made purchases as needed, inquiries increased, and procurement was mainly EXW cargoes self-picked up from production site; spot market trading activity improved somewhat. Inventory: On August 17, LME lead inventory fell by 1,700 mt, or 0.41%, to 410,975 mt; according to SMM, as of August 17, total social inventory of lead ingots across five locations reached 78,600 mt, up 5,800 mt from August 10 and up 3,400 mt from August 13. Lead Price Forecast for Today: Demand side, as downstream enterprises ended their high-temperature holidays, some enterprises resumed normal production, and routine procurement demand rebounded, easing post-delivery inventory buildup pressure for lead ingots to some extent. Supply side saw both increases and decreases: maintenance at primary lead enterprises was set to reduce supply to a certain extent; coupled with smelters holding prices firm while selling, the widening of spot lead discounts was limited. As losses at secondary lead enterprises improved somewhat, some enterprises resumed production, increasing market circulating supply, and secondary refined lead maintained trading at relatively larger discounts. Overall, lead prices were expected to maintain a fluctuating trend.

SMM News, August 17: During the session, the SHFE lead 2608 contract for the current month closed at 15,800 yuan/mt, with a settlement price of 15,825 yuan/mt, open interest of 3,095 lots, delivery volume of 15,475 mt, and warrant inventory of 65,864 mt. The SHFE lead 2608 contract completed delivery smoothly. The SHFE lead 2609 contract posted a trading volume of 41,201 lots and open interest of 35,793 lots; the SHFE lead 2610 contract posted a trading volume of 49,825 lots and open interest of 75,440 lots. The most-traded SHFE lead contract officially rolled over to the 2610 contract. During the session, the SHFE lead 2609 contract drifted higher, opening at 15,825 yuan/mt and quickly surging to 15,940 yuan/mt after the open, before pulling back to 15,865 yuan/mt. It then moved sideways in the 15,875-15,910 yuan/mt range, and rebounded again in late afternoon trading to 15,920 yuan/mt, staying high and moving sideways in a narrow range. It finally closed at 15,920 yuan/mt, up 95 yuan/mt from the previous trading day’s closing price, a gain of 0.60%, with the daily K-line posting a small bullish candlestick. Trading volume was 41,201 lots, while open interest fell by 3,343 lots to 35,793 lots. With lead prices strengthening and delivery of the 2608 contract, quotations for warrant cargo were relatively limited. In some regions, smelter inventories declined and maintenance was approaching, tightening circulating supply and strengthening the willingness to hold prices firm, while some smelters in south China actively sold, and the divergence between shipments in the south and north widened somewhat. Secondary lead smelters shipped in line with the market, with quotations little changed WoW. Downstream players returned after the weekend and purchased as needed; enquiry and transaction activity improved, and some enterprises reported better battery orders, with support from rigid demand strengthening somewhat. In the short term, supply tightens in some regions and improved downstream rigid demand will support prices, but high lead prices still suppress purchase willingness. Supply divergence caused by active shipments from south China smelters may limit upside room. SHFE lead is expected to consolidate at highs in the short term; attention should be paid to downstream actual purchase strength and smelter inventory changes.

SMM News on August 17: Dealers in Jiangxi reported that replacement demand in the automotive lead-acid battery market was average, and retailers’ purchases were still mainly driven by rigid demand. As lead prices rose, risk-averse sentiment in the battery wholesale market eased somewhat. The current wholesale price for the mainstream model 6-QW-45Ah was 160-180 yuan per unit. Manufacturers in Zhejiang reported that overall demand in the automotive lead-acid battery market was relatively weak, and dealers were not very active in purchasing. Coupled with rising raw material prices such as lead and tin, battery production costs increased, and sales pressure intensified somewhat. The current factory operating rate remained at 70-80%. Manufacturers in Hebei reported that replacement demand for automotive lead-acid batteries was poor, and finished-product orders showed no obvious improvement for the time being. To avoid a further build-up in inventory, the current factory operating rate was below 70%, and raw material lead was mainly procured via long-term contract.

SMM News on August 17: Today, suggested price adjustments in the secondary refined lead market diverged, with online prices raised by 0-100 yuan/mt. Sentiment games between upstream and downstream were evident: although downstream purchase willingness improved, buyers resisted a rise in lead prices; upstream suppliers were bullish and expected prices to increase. Most actual market transactions were concluded at discounts of 100-50 yuan/mt against the SMM #1 lead average price, while mainstream quotations were at discounts of 50-0 yuan/mt. Today, the SMM secondary refined lead average price was 15,650 yuan/mt, a discount of 50 yuan/mt against the SMM #1 lead average price. Suppliers’ willingness to sell was 1.54, and today’s secondary refined lead purchasing sentiment was 2.09 (historical data can be queried by logging into the database).