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.

Futures: Overnight, LME lead opened at $1,957/mt, moving sideways around the daily average during the Asian session. Entering the European session, the US dollar index strengthened before pulling back, and the broad-based gains in nonferrous metals boosted LME lead to rise all the way to a high of $1,996/mt. After small fluctuations at high levels, it finally closed at $1,995.5/mt, up $36/mt or 1.84%. Overnight, the most-traded SHFE lead contract opened at 16,715 yuan/mt, initially dipped to a low of 16,700 yuan/mt, then fluctuated upward, lightly touching 16,800 yuan/mt at highs, and finally closed at 16,790 yuan/mt, up 45 yuan/mt or 0.27%. On the macro front: US Trade Representative Greer recently stated that the US will continue to advance the 301 investigation into China's implementation of the Phase One trade deal and may take tariff measures. Against the backdrop of a rebound in risk appetite, market expectations for the US Fed to start interest rate cuts before mid-year have significantly cooled, with expectations for a June rate cut diminishing. German Chancellor Friedrich Merz paid his first official visit to China from February 25 to 26, accompanied by a high-level delegation including 30 representatives from the German business community. Spot fundamentals: In the Shanghai market, Chihong lead was quoted at discounts of 80-50 yuan/mt against the SHFE lead 2603 contract. SHFE lead maintained a consolidation trend, and as it was late February with the transition between old and new long-term contracts, some suppliers actively cleared inventory by shipping goods at discounts, while a few traders purchased on dips. Downstream enterprises were still in the early stages of resuming work, with limited rigid demand and few inquiries. In terms of secondary lead, some smelters had not yet resumed production, market quotations were scattered, operating enterprises held prices firm for shipments, and secondary refined lead was quoted at premiums of 0-25 yuan/mt against the SMM #1 lead average price ex-works. Downstream enterprises adopted a wait-and-see approach with minimal purchases, and spot order market transactions had not improved significantly. Inventory: On February 25, LME lead inventory decreased by 25 mt to 286,300 mt. As of February 24, the total social inventory of lead ingots across five regions tracked by SMM accumulated further, with the total jumping to a five-month high. Today's lead price forecast: This week, downstream enterprises gradually resumed work and production, with spot purchases mainly focused on long-term contract cargo pick-up, while spot order purchasing demand remained weak. On the supply side for refined lead, primary lead smelters in Hunan that underwent maintenance and production cuts during the holiday gradually resumed crude lead production; primary lead output is expected to recover sequentially from early March to mid-March, with quotations relatively firm. For secondary refined lead, supply recovery was limited by the end of February, but a concentrated recovery is anticipated in early March. Subsequently, the lead market is expected to see both supply and demand increase after the recovery in lead consumption. This week, as the supply of refined lead has not yet recovered concentratedly, support for lead prices remains moderate, and lead prices may continue to move sideways in the short term.

Futures: Overnight, LME lead opened at $1,957/mt and weakened slightly during the Asian session. Entering the European session, it continued to decline, probing a low of $1,950.5/mt, then rose to fluctuate near the daily moving average, ultimately closing at $1,959.5/mt, up $7.5/mt, a gain of 0.38%. Overnight, the most-traded SHFE lead contract opened at 16,655 yuan/mt. After the session began, it dipped to a low of 16,650 yuan/mt, then fluctuated upward, lightly touching a high of 16,840 yuan/mt, and finally closed at 16,745 yuan/mt, up 20 yuan/mt, a gain of 0.12%. On the macro front: The Trump administration is considering imposing new "national security tariffs" on six industries. According to informed sources, the tariffs under consideration may cover industries such as large-scale batteries, pig iron and iron fittings, plastic pipes, industrial chemicals, as well as power grid and telecommunications equipment. These tariffs would be levied under Section 232 of the Trade Expansion Act of 1962. The new US tariffs on the six major industries will be implemented separately from the new global 15% tariff. Regarding recent US tariff adjustment measures, a spokesperson for the Ministry of Commerce stated that China is closely monitoring and will comprehensively assess the relevant US measures. Subsequently, depending on the situation, China will decide at an appropriate time to adjust its countermeasures against US-origin fentanyl tariffs and reciprocal tariffs. Spot fundamentals: In the Shanghai market, Chihong lead was offered at a discount of 50-0 yuan/mt against the SHFE lead 2603 contract. Today was the first trading day after the Chinese New Year holiday. Suppliers gradually resumed work and attempted to offer prices for shipments. Some with higher prices offered at a premium of 150 yuan/mt against the SHFE lead 2603 contract, while those eager to clear inventory directly sold at a discount, with transactions reaching a minimum discount of 100 yuan/mt against the SHFE lead 2603 contract. SHFE lead got off to a good start on its first trading day. Additionally, as it is late February, suppliers were mostly actively shipping goods, while downstream enterprises were in the initial stages of resuming work, resulting in limited inquiries. Only a few enterprises restocked based on rigid demand, and initial transactions began to emerge in the market. Inventory: On February 24, LME lead inventory was recorded at 286,325 mt, unchanged from the previous day. As of February 24, the total social inventory of lead ingots in five regions tracked by SMM accumulated, with the total amount jumping to a five-month high. Today's lead price forecast: As enterprises across the lead industry chain gradually resumed work after the Chinese New Year holiday, lead consumption was temporarily absent because lead-acid battery enterprises had longer holidays than smelters. This led to accumulated lead ingot inventory at smelters after the holiday, which was transferred to social inventory. The first day after the holiday was the delivery date for the SHFE lead 2602 contract. Suppliers had gradually completed inventory transfers and shipments to delivery warehouses during the holiday, leading to an expected accumulation in social warehouse inventory, which surpassed the 60,000-mt mark. Downstream enterprises had not fully resumed work this week, and the lead ingot inventory reserved by most enterprises before the holiday could be maintained until around the Lantern Festival. In the short term, social lead ingot inventory will remain high. Follow-up attention is still needed on the recovery of lead consumption and the pace of secondary refined lead supply restoration. In the short term, lead prices may still be under pressure amid accumulating inventory.

Futures: Overnight, LME lead opened at $1,964/mt, fluctuating rangebound around the daily average during the Asian session. It initially fell then rose during the European session, touching a high of $1,968.5/mt before pulling back again, exploring a low of $1,949.5/mt, and finally closed at $1,952/mt, down $14.5/mt, a decrease of 0.74%. During the Chinese New Year holiday, LME lead showed a weak and rangebound trend, overall trading between $1,943.5/mt and $1,974/mt. As of 18:00 on February 23, it closed at $1,962.5/mt, down $9.5/mt compared to the pre-holiday (February 13) closing price. SHFE lead was closed for the Chinese New Year holiday. On the macro front: Reportedly, US President Donald Trump posted on social media on February 21, stating that the "global import tariff" rate he announced the previous day on goods imported into the US would increase from 10% to 15%, "effective immediately." Global tariff changes became the main factor affecting market pricing during the holiday. US Customs stated that it would stop collecting tariffs ruled unconstitutional by the Supreme Court starting February 24. The US January CPI increased by 2.4% YoY, slowing down from expectations of 2.5%, hitting a new low since May 2025; core CPI rose 2.5% YoY, a new low since March 2021. The unexpected cooling of January inflation data added further support to market expectations for the US Fed to cut interest rates within the year. Domestically, China continued to promote large-scale equipment upgrades this year, with equipment renewal projects in multiple sectors accelerating their implementation. Currently, the new round of equipment upgrades for 2026 has been successively launched in 31 provinces (autonomous regions, municipalities) and the Xinjiang Production and Construction Corps, involving about 20 sectors including industry, electronic information, and energy conservation, carbon reduction, and environmental protection. Spot fundamentals: Before the Chinese New Year holiday, lead market trading gradually halted. On the last trading day before the holiday, SHFE lead showed a consolidating and pulling back trend, as traders closed positions for the holiday, and futures trading activity also declined synchronously. Suppliers largely stopped offering quotes or were already on holiday. The last batch of downstream enterprises entered the holiday state that afternoon, leaving the lead market in a state of no prices and no trading. Inventory side: On February 23, LME lead inventory was 286,325 mt, an increase of 53,675 mt compared to the pre-holiday (February 13) level of 232,650 mt. As of February 12, SMM lead ingot social inventory across five regions again refreshed the 5-month high. Today's lead price forecast: Due to varying holiday schedules for upstream and downstream enterprises during the Spring Festival, the main lead consumption end was almost entirely on holiday and shut down, while the refined lead supply end enterprises had fewer holiday shutdowns than downstream enterprises. Medium and large primary lead enterprises basically operated normally. Lead consumption was absent during the holiday period, leading to expectations of conventional inventory buildup for lead ingots after the holiday. Regarding post-holiday work resumption, lead-acid battery enterprises are expected to resume production gradually from the first to the second week after the holiday. However, as some downstream enterprises still had leftover lead ingot stockpiles from before the holiday, procurement expectations are limited for the first week after the holiday. Although secondary lead enterprises' production resumption plans are mostly scheduled for the second week after the holiday, primary lead smelters maintained relatively normal production. In-factory inventory accumulated during the Spring Festival holiday is expected to be gradually shipped under long-term contracts or transferred to social warehouses after the holiday. The expectation of lead ingot inventory buildup is also likely to be a main factor putting pressure on lead prices in the initial period after the holiday. As downstream lead enterprises resume work and lead consumption recovers normally, lead prices may see opportunities for fluctuating rebounds. Data source statement: Except for public information, other data are processed by SMM based on public information, market communication, and relying on SMM's internal database model, for reference only and do not constitute decision-making advice.

[SMM Analysis] Review and Post-Holiday Outlook of the Lead Market During the 2026 Chinese New Year Holiday SMM, February 23: During the Chinese New Year holiday (February 15–23), the overseas macro environment was complex, with Trump’s global tariff changes being the primary factor influencing market pricing over the break.