1. Prices Trend
This week, the lead market (Oct.14-Oct.18) fell and rose. The average price in the domestic market was 16,856.25RMB/t at the beginning of the week and 17,018.75RMB/t at the end of the week, with a weekly increase of 0.96%.
On Oct 19, the Lead Commodity Index was 103.58, 22.71% lower than the peak of 134.01 in the cycle (Nov 29, 2016), and 38.79% higher than the lowest point of 74.63 (Mar 19, 2015). (Cycle: Sep 1, 2011 to date)
2. Analysis of quotations tendency
Domestic market: This week's spot lead market fell and then soared. The main price range of spot lead was 16,800-17,100RMB/t. On Monday, China's foreign trade data was weak and the price went low due to the impact of PB, and on Tuesday, led by PBD, it began to strengthen. This week's downstream purchase was relatively low, and the market was generally cold. The mainstream price of brand lead in Shanghai remained at about 17,000-17,100RMB/t. The market brands are concentrated in Shuangyan, Jinsha, Muleng, etc., Yuguang, wanyang, Jinli, etc. in Jiangsu and Zhejiang markets. As the battery was in the off-season, the downstream purchase intention was low, the main focus was to consume the inventory, and the transaction was cold.
Major international events:
ILZSG：In July, the global lead supply shortage was 4,200 tons: London, Sep 18, the data released by International Lead and Zinc Research Group (ILZSG) showed that the global lead supply shortage narrowed to 4,200 tons in July, it was 13,100 tons in June. In the first seven months of 2019, the supply shortage of global lead market expanded to 47,000 tons, compared with 35,000 tons in the same period of last year.
WBMs: From January to July 2019, the supply shortage of the global lead market was 177,000 tons: London, Sep 18, according to the data released by the world Bureau of Metal Statistics (WBMs) on Wednesday, the supply shortage of the global lead market from January to July 2019 was 177,000 tons, and that of the whole year 2018 is 265,000 tons. At the end of July, the total inventory decreased by 27,000 tons compared with the end of 2018. Unreported inventory changes were not included in consumption statistics. From January to July 2019, the global refined lead production (primary and recycled) was 7.329 million tons, an increase of 11.70% over the same period last year. China's apparent demand is estimated to be 3.577 million tons, a year-on-year increase of 782,000 tons, accounting for about 48% of the global total. From January to July 2019, the apparent demand of the United States decreased by 11,000 tons year on year. In July 2019, the refined lead production was 1,052,700 tons, and the consumption was 1,057,400 tons.
Nonferrous Industry: Market sentiment was mixed this week. At the beginning of this week, China and the United States reached an agreement on the framework of trade negotiations. The process of brexit was accelerated, the market performance was good, and basic metals generally stabilized in a high range of shocks. However, with the release of global economic data in succession, the trend of global economic downturn made the basic metals one after another spit out the weekly gains, showing a high pressure situation.
3. Prospect for the future
Next week, European and American economic data are still relatively concentrated, and are expected to remain weak. The US dollar is in low-level consolidation, which may support the basic metals. There are long orders delivered in the domestic trade market. Due to the upgrade of value-added tax tickets, the spot performance may be strong. Most of the basic metals will maintain the swinging pattern in certain range, and it is temporarily difficult to have the ability and space for a major breakthrough. Spot lead upward pressure has increased, it will mainly remain swing and consolidate.
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