SMM, July 24: This week, secondary refined lead EXW transaction prices were at discounts of 100~50 yuan/mt against the SMM #1 lead average price, and deliveries at parity within industrial parks were transacted. Some suppliers held prices firm and held back from selling, with quotations at premiums of 75~125 yuan/mt against the SMM #1 lead average price, or even halted shipments. Raw material prices declined in tandem, but smelters remained deep in losses. As of July 24, 2026, the theoretical comprehensive profit/loss value stood at -498 yuan/mt for large-scale secondary lead enterprises and -679 yuan/mt for small and medium-sized ones. Looking ahead to next week, expectations for secondary lead production cuts persist, with most cargo owners continuing to hold back from selling and waiting on the sidelines. The remaining supplies are expected to transact at discounts of 50 yuan/mt to parity. Lead price rebound space is limited, and the loss situation for smelters will be hard to reverse in the short term.

SMM July 22: Overnight, LME lead opened at $1,880/mt, drifting higher during Asian trading hours. Entering the European session, it rose to a high of $1,890/mt before weakening due to increased bearish positions, giving up all gains to hit a low of $1,867/mt, and finally settled at $1,868/mt, down 0.48%. Overnight, the most-traded SHFE lead 2609 contract opened lower with a gap at 15,820 yuan/mt. After briefly touching a high of 15,880 yuan/mt in early trading, it drifted lower. As bears added positions, SHFE lead hit a low of 15,700 yuan/mt and finally settled at 15,715 yuan/mt, down 1.07%. Demand side, the off-season consumption in the lead-acid battery market persists. Downstream enterprises continue to purchase as needed. As some enterprises have expectations of holidays, the subsequent purchasing intensity for lead ingots will further decline. Supply side, secondary lead enterprises maintain low operating rates, with limited circulating supplies in the market, while primary lead supply is relatively ample. The spot market is expected to continue trading at a discount. Additionally, high uncertainty in the Middle East conflict has raised energy and shipping costs, becoming one of the factors affecting lead prices.

Futures: Overnight, LME lead opened at $1,880/mt, drifting higher during the Asian session. Entering the European session, it tested a high of $1,890/mt before weakening as bears added positions, giving back all gains to dip to $1,867/mt, and finally closing at $1,868/mt, down 0.48%. Overnight, the most-traded SHFE lead 2609 contract opened lower with a gap at 15,820 yuan/mt, dipped slightly to a high of 15,880 yuan/mt before drifting lower, with bears adding positions to push SHFE lead down to 15,700 yuan/mt, and finally closed at 15,715 yuan/mt, down 1.07%. On the macro front: Trump: Iran wants to meet but we are not interested; will strike the Harzand region in Iran (where nuclear facilities are reportedly located) very hard; if the Houthis blockade the Red Sea, the US will "take action". Iran's military struck a US airbase in Bahrain, saying that if the US attacks Iran's nuclear facilities, all US and allied interests in the region will become targets. The 10% temporary tariff is about to expire, US Trade Representative previews new tariffs will soon fill in; according to the UK Financial Times: Trump is about to impose new tariffs on dozens of countries as soon as this week. China's MIIT lithium battery and similar products standard working group: will hold discussions on 10 industry standards for solid-state lithium batteries. The A-share STAR 50 Index surged over 10%, hitting a new high for the year in its biggest single-day gain. Spot Fundamentals: SHFE lead continued to move sideways, with suppliers selling as needed, though there were few quotations in the Jiangsu, Zhejiang, Shanghai region. Additionally, EXW cargoes from primary lead smelters were ample and generally quoted at discounts, with mainstream production areas offering at discounts of 50-0 yuan/mt against the SMM #1 lead average price. For secondary lead, smelters showed modest enthusiasm for shipments, with limited circulating supply in the market; some secondary refined lead quotations were at discounts of 50-0 yuan/mt against SMM #1 lead. Downstream enterprises remained cautiously on the sidelines, digesting inventories during production, with some waiting for new monthly long-term contract execution and only a small amount of just-in-time procurement, leading to sluggish market transactions. Inventory: On July 21, LME lead inventory decreased by 2,025 mt to 449,750 mt; as of July 20, total social inventory of SMM lead ingots across five regions fell by 8,000 mt MoM from July 16. Today's Lead Price Forecast: Demand side, the lead-acid battery market remained in its consumption off-season, with downstream enterprises maintaining purchases as needed; as some enterprises have holiday expectations, lead ingot purchasing strength is expected to weaken further. Supply side, secondary lead enterprises maintained low operating rates with limited supply circulating in the market, while primary lead supply was relatively ample; spot market transactions are expected to remain skewed towards discounts. In addition, the high uncertainty of the Middle East conflict has driven up energy and shipping costs, which has become one of the factors affecting lead prices.

In summary, the import dividends marginally faded in June, while exports experienced a periodical recovery. The narrowing of the import window in July will cause monthly imports to decline significantly, and the annual trade pattern will enter a new phase of reduced imports and export recovery.

SMM July 20 News: According to the latest customs data, imports of lead concentrates in June 2026 were 116,000 mt in physical content, up 9,000 mt or 8.45% MoM, down 1.69% YoY. Cumulative imports of lead concentrates in January-June were 703,900 mt in physical content, down 4.95% YoY. Based on import data by country, the top three sources of lead concentrate imports in June were Russia (31,200 mt in physical content, 26.89%), Peru (19,800 mt in physical content, 17.09%), and Australia (10,200 mt in physical content, 8.76%). In June, lead concentrate imports increased MoM, mainly driven by notable growth from Peru and Russia. From the import profit margin perspective, with the domestic market outperforming the overseas market in June, the SHFE/LME lead price ratio kept rising, and import losses for lead concentrates narrowed to around -200 yuan/mt. Amid a domestic ore shortage, lead concentrate TCs were further lowered, boosting domestic smelters' demand for imported ore and also contributing some growth. Entering July, domestic smelters entered planned maintenance. Coupled with persistent tight raw material supply and losses that prompted more maintenance at secondary lead enterprises, social inventory hovered around 70,000 mt. Overseas, large deliveries to warehouses for two consecutive days pushed LME inventory beyond 450,000 mt. The domestic market continued to outperform the overseas market, and lead concentrate imports remained at a slight loss. Primary lead smelters, supported by profits from by-products such as sulphuric acid, still had strong demand for ore. In July, south China entered the rainy season, leading some mines to suspend operations for maintenance, while safety and environmental protection inspections also shut down some small mines. Demand for imported lead concentrates stayed high. Meanwhile, overseas mine production and transportation recovered somewhat in Q2, and lead concentrate inventory at main ports increased to over 20,000 mt. Lead concentrate imports are expected to rise further in July. Data source statement: Except for publicly available information, all other data are derived from publicly available information, market communication, and SMM’s internal database models, processed by SMM. They are for reference only and do not constitute decision-making advice.

[Phased Recovery in SHFE/LME Price Ratio Window Limits June Lead Concentrate Import Growth] According to the latest customs data, China imported 116,000 mt in physical content of lead concentrates in June 2026, up 9,000 mt or 8.45% MoM but down 1.69% YoY. In January-June, cumulative lead concentrate imports reached 703,900 mt in physical content, down 4.95% YoY.

SMM July 20 news: Last Friday, LME lead opened at $1,869.5/mt and moved sideways during Asian trading hours. Entering the European session, it dipped initially before rebounding, touching a low of $1,863.5/mt, and later surged to a high of $1,890.5/mt near the close as bears reduced their positions, eventually settling at $1,887/mt, up 0.96%. Last Friday night, the most-traded SHFE lead 2609 contract opened at 15,875 yuan/mt, briefly hit a low of 15,855 yuan/mt in early trading, and then rebounded to a high of 15,980 yuan/mt as bears cut their positions, before finally closing at 15,945 yuan/mt, up 0.44%. Due to delivery factors and downstream purchases, visible lead ingot inventory rose then fell last week. After the bearish news of inventory buildup outside China was fully digested, the Chinese market's attention shifted to the production of secondary lead enterprises and downstream purchasing trends. If lead ingot inventory continues to destock this week, lead prices are expected to return to and consolidate above the 16,000-yuan-per-mt level.

Futures: Last Friday, LME lead opened at $1,869.5/mt and moved sideways during the Asian session. Entering the European session, it dipped first before rebounding, hitting a low of $1,863.5/mt, then climbed to a high of $1,890.5/mt near the close as bears cut positions, finally settling at $1,887/mt, up 0.96%. Last Friday evening, the most-traded SHFE lead 2609 contract opened at 15,875 yuan/mt, briefly touching a low of 15,855 yuan/mt in early trading, then rebounded to a high of 15,980 yuan/mt as bears reduced positions, finally closing at 15,945 yuan/mt, up 0.44%. On the macro front: US media reports: US-Iran conflict intensifies, the Pentagon is rushing additional F-16 and F-35 fighter jets to the Middle East. The Eurozone's May current account surplus expanded, as primary income growth offset a narrowing trade surplus. The State-owned Assets Supervision and Administration Commission of the State Council (SASAC) stated that central state-owned enterprises must continue to achieve breakthroughs in original technologies such as foundational algorithms, physical AI, intelligent computing chips and quantum communication. The National Development and Reform Commission (NDRC) released an action plan for AI cooperation and development. The Ministry of Finance adjusted some battery consumption tax policies, gradually resuming collection of consumption tax on certain new energy batteries. Spot fundamentals: SHFE lead consolidated on a strong note. Suppliers showed moderate selling enthusiasm, but circulating cargoes in the Jiangsu, Zhejiang and Shanghai markets were limited, with few quotes available. Meanwhile, primary lead smelters sold EXW cargoes following the market trend, with quotes at wider discounts in some regions; mainstream producing areas quoted at discounts of 50-0 yuan/mt against the SMM #1 lead average price for ex-works sales, with a few deals done at even larger discounts. In secondary lead, smelters offered more quotes, with secondary refined lead quoted at discounts of 50-0 yuan/mt against the SMM #1 lead average price ex-works. Downstream enterprises mostly shifted to long-term contract procurement or paused to observe the market, muting the trading atmosphere in the spot order market. Inventory: On July 17, LME lead inventory decreased by 1,950 mt to 452,075 mt. As of July 16, total social inventory of SMM lead ingots across five regions decreased by about 500 mt WoW from July 13. Lead price forecast for today: Due to delivery factors and downstream procurement, visible lead ingot inventory rose first and then fell last week. With the bearish overseas inventory buildup factor now priced in, the Chinese market's focus shifted to the production of secondary lead enterprises and downstream purchasing trends. If lead ingot inventory continues to destock this week, lead prices are expected to return to and consolidate above the 16,000 yuan/mt level.

SMM July 17 News: This week, secondary refined lead EXW transaction prices were mainly at a discount to the SMM #1 lead average price. Smelters held back from selling due to losses, and price fluctuations during the week caused the discount/premium range to fluctuate between a discount of 50 yuan/mt and a premium of 30 yuan/mt. Industry losses widened first and then narrowed. As of July 17, 2026, the theoretical comprehensive profit/loss for secondary lead enterprises stood at -317 yuan/mt for large-scale producers and -497 yuan/mt for small and medium-scale producers. Next week, expectations for production cuts in secondary lead will support lead prices, and premiums/discounts may return to parity territory. However, the battery off-season combined with high scrap battery costs will make it difficult for losses to improve.

Next week, key macroeconomic data will include US June housing starts, building permits, industrial production, and the University of Michigan consumer sentiment index, which will influence market expectations for the Fed's rate path. Meanwhile, the ongoing Middle East geopolitical conflict continues to escalate, with shipping volume through the Strait of Hormuz falling to about one-tenth of pre-war levels. Geopolitical risks have pushed oil prices higher, raising supply-chain cost expectations. LME lead, within the week LME lead inventory surged by 160,000 mt, sparking risk-off sentiment and driving LME lead to its lowest level in over a year. As lead prices fell, the LME lead Cash-3M spread remained in a deep contango, with the latest quote at -$43.83/mt. Moreover, heightened uncertainty over the Middle East conflict, along with rising energy and shipping costs, may become another factor affecting lead prices. Once the inventory buildup news is digested by the market, lead prices are expected to get a breather. Next week, LME lead is expected to trade at $1,850-1,905/mt. SHFE lead, visible lead ingot inventories first increased then declined this week due to delivery factors and downstream purchasing. After the bearish news of overseas inventory buildup ran its course, market attention in China shifted to the production dynamics of secondary lead enterprises and downstream purchasing trends. If lead ingot inventories continue to destock, lead prices are expected to return to 16,000 yuan/mt. The most-traded SHFE lead contract is expected to trade at 15,600-16,150 yuan/mt next week. Spot lead price forecast: 15,650-15,950 yuan/mt. Consumption side, the lead-acid battery market remains in the off-season, with downstream enterprises continuing to purchase as needed. However, as lead ingots re-enter the circulation market after delivery, downstream cargo pick-up is expected to increase. Supply side, secondary lead enterprises maintain low operating rates, with limited supply circulating in the market, while primary lead supply is relatively ample. The spot market is expected to continue trading at a discount.