Report Industry Investment Rating No relevant information provided. Core Viewpoints of the Report - Based on the judgment that the lead market will maintain a situation of strong supply and weak demand in 2026, prices are expected to fluctuate within a range. The main operating range for Shanghai lead is 16,000 - 18,000 yuan/ton, and for London lead, it is 1,900 - 2,100 US dollars/ton [1][67]. - In 2026, the domestic market may have a slight surplus. The supply of lead ore is expected to improve, the supply of waste batteries may increase slightly, and the production of refined lead will continue to grow. The demand side may be supported by the continued replacement consumption and the positive growth of two - wheeled electric vehicles. The energy storage demand is growing explosively, and the incremental space for lead - carbon batteries is broad. However, the export of lead - acid batteries may face pressure, and the overall supply - demand situation is weak, with prices remaining range - bound. The price - holding intention in the waste battery recycling sector is strengthening year by year, which is expected to continuously lift the bottom of the lead price [1][67]. - It is recommended to pay attention to seasonal fluctuation opportunities. After the small spring of consumption at the beginning of the year, consumption weakens marginally, and prices may fall under pressure. In the middle of the year, battery manufacturers replenish stocks in advance for the consumption peak season, while the supply of waste batteries does not increase significantly during the replacement consumption peak season, which may bring a temporary supply - demand gap and inject upward momentum into prices [2][67]. Summary by Directory 1. 2025 Review: First Decline then Rise, with a Slow Uptrend in the Center of Gravity - In January 2025, the lead price declined due to the end of downstream inventory preparation, high finished - product inventory, and a potentially longer Spring Festival holiday. In February, the price rose initially but then fluctuated after factoring in the expected production increase of large downstream manufacturers. In March, the price increased as consumption recovered and downstream battery companies increased inventory. In April, it declined due to macro - tariff impacts and the entry into the consumption off - season. In May and June, prices fluctuated in a weak supply - demand situation [7]. - From July to December, the lead price showed a complex trend. In July, it first rose and then fell due to changes in supply and demand. In August, it fluctuated weakly. In September, it rose after a period of fluctuation. In October, it trended strongly with obvious supply pressure on primary lead and incremental demand. In November, it climbed and then declined as primary lead production increased and secondary lead production grew rapidly [8][9]. 2. Supply - Demand Weakness, with Dull Fundamental Contradictions 2.1 Lead Ore Supply is Rigid, but There Will Be Increment in the Next Year - In the long - term, overseas mining enterprises' capital expenditure in lead ore has been low, resulting in relatively rigid global lead ore production. The supply cycle of lead ore is more closely related to that of zinc ore. In 2025, global lead ore supply disturbances increased, and overseas production increments were limited. For 2026, there is an expected increment of 100,000 tons, with a year - on - year growth rate of 2.2% [10][13][14]. 2.2 Domestic Mines Increased Production This Year, but Realistic Contradictions Still Exist - In 2025, from January to November, China's lead concentrate production increased by 10.4% year - on - year, mainly due to the production increase of mines such as Xinjiang Huoshaoyun. It is expected to contribute an increment of 100,000 tons in 2026. The continuous tight supply of lead concentrate has squeezed the profit margin of primary lead smelting. China's lead raw material import structure is becoming more diversified, but the import profit of lead concentrate is meager [20][26]. 2.3 Insufficient Endogenous Power, Driven by By - Product Profits - Since March 2025, the thickening of primary lead plant profits has driven high - level production. By - product profits such as silver and sulfuric acid have become the main factors driving the supply elasticity of primary lead plants. Assuming that the prices of by - products remain high in 2026, primary lead supply is expected to continue to grow slightly, and supply elasticity may increase [33][34]. 2.4 Problems in Secondary Lead Supply Still Exist, Forming a Strong Constraint - China's secondary lead production capacity is severely over - supplied, and the shortage of raw materials has led to low - level production. Since the second quarter, secondary lead enterprises have suffered losses, and it is expected that the production of secondary lead will continue to decline in 2026. Although there will be more incremental supply in the long - term, the growth rate of capacity expansion may slow down, and some enterprises are transforming to a multi - raw material production mode [36][37]. 3. Is the Demand Really Collapsing: A Flash in the Pan or a Steady Stream? 3.1 Policy Boosts Consumption, Electric Bicycles Return to Positive Growth, and Automobile Exports Contribute Significantly - In 2025, new national standards and national subsidy policies have stimulated the growth of the electric bicycle industry. Automobile consumption policies have also continuously increased, and the trade - in policy has effectively boosted consumption. It is expected that the trade - in subsidy scale will continue to be maintained at 300 billion yuan in 2026 [46][52][53]. 3.2 Explosive Growth in Energy Storage Demand, Vast Incremental Space in the Future - The energy storage demand for lead - acid/lead - carbon batteries is growing explosively. Lead - acid batteries have cost, safety, recycling, and low - temperature performance advantages, but also have performance shortcomings. In 2025, the lead consumption of lead - carbon batteries was 27,300 tons in the first three quarters, and it is expected to increase by 28,300 tons in 2026, with a marginal contribution to consumption of 0.4% [60][61]. 3.3 High Domestic - Foreign Price Ratio and Tariff Impacts Weigh on Lead - Acid Battery Exports - In 2025, the export volume of lead - acid batteries declined rapidly due to the expansion of the domestic - foreign price ratio and tariff impacts. The anti - dumping tariff imposed by the GCC on Chinese lead - acid batteries will take effect in 2026, which may significantly reduce the export volume [64]. 4. Conclusion and Investment Outlook - In 2026, the lead market will maintain a situation of weak supply and demand, with prices fluctuating within a range. The main operating range for Shanghai lead is 16,000 - 18,000 yuan/ton, and for London lead, it is 1,900 - 2,100 US dollars/ton. It is recommended to pay attention to seasonal fluctuation opportunities [67].

1. Report Industry Investment Rating No relevant information provided. 2. Core Viewpoints of the Report - In August, the lead market will see an increase in both supply and demand, with marginal improvement in fundamentals and strong support from the raw material end. Lead prices are expected to fluctuate and strengthen, operating in the range of 16,500 - 17,500 yuan/ton. It is recommended to focus on range - based operations [85]. 3. Summary According to the Table of Contents 3.1 Lead Market Review: Oscillating Downward - In July, consumption was average, lead prices fell from highs, and the price center shifted down. In the middle and late June, tight lead concentrate and scrap batteries led to reduced supply at the ingot end and rising lead prices. In early July, high lead prices suppressed downstream purchasing enthusiasm, and prices stabilized. In mid - July, the traditional peak season underperformed, downstream purchasing did not improve substantially, and inventories accumulated, causing lead prices to fall. After the 07 contract delivery, the slow resumption of primary lead and tight scrap batteries led to a temporary supply shortage, and lead prices stopped falling and rebounded slightly but weakened again at the end of the month [9]. - As of July 31, the average price of SMM1 lead ingots was 16,675 yuan/ton, down 1.62% from the end of June and 14.05% from the same period last year; the average price of recycled refined lead was 16,700 yuan/ton, down 1.04% from the end of June and 13.47% from the end of last year; the closing price of the SHFE lead main contract was 16,735 yuan/ton, down 2.70% from the end of June and 11.01% from the same period last year; the closing price of LME three - month lead (electronic trading) was 1,969.5 US dollars/ton, down 3.53% from the end of June and 6.19% from the same period last year [3][10]. 3.2 Raw Materials & Profits: Strong Cost Support 3.2.1 Primary Lead: Lead Concentrate Remains Tight, TC Drops Slightly - As of July 31, the average price of domestic lead concentrate was 16,175 yuan/ton, down 1.37% from the end of June and 14.19% from the same period last year; the average price of imported lead concentrate was 16,031.29 yuan/ton, down 3.09% from the end of June and 5.71% from the same period last year [25]. - In May 2025, global lead concentrate production was 38.28 tons, up 1.46% month - on - month and down 0.05% year - on - year. From January to May, the cumulative production was 181.11 tons, up 2.51% year - on - year. In July, Xinjiang and Qinghai mines increased production, but domestic lead concentrate was still in short supply due to refineries' preference for domestic ore. In June, domestic lead concentrate production was 15.31 tons, up 2.55% month - on - month and 14.94% year - on - year [27]. - Imported lead concentrate had little bulk cargo, and port inventory was basically zero. As of July 31, the profit of imported lead concentrate was 143.71 yuan/ton. In June, lead concentrate imports were 11.80 tons, up 13.54% month - on - month and 26.90% year - on - year [28]. - Refineries' lead concentrate inventory remained high. As of the end of June, refineries' lead concentrate inventory was 41.70 tons, and the raw material inventory days were 26 days. Due to tight ore supply, lead concentrate processing fees declined, but refinery profits improved due to by - product revenues [39]. - As of July 31, primary lead smelting profit (processing) was 46.8 yuan/ton. As of July 25, domestic lead concentrate processing fee was 500 yuan/metal ton, and imported lead concentrate processing fee was - 60 US dollars/dry ton. As of July 27, the average sulfuric acid price in East China was 630 yuan/ton, and the average price of No. 1 silver on July 31 was 8,939 yuan/kg [40]. 3.2.2 Recycled Lead: The Peak Scrap Battery Season Didn't Materialize, Scrap Battery Prices Remained Firm - In July, the peak scrap battery season did not arrive. Recyclers adopted a "quick - in, quick - out" model, and prices were firm. However, recycled lead refineries faced cost inversion and were cautious in purchasing, resulting in a stalemate in the scrap battery market. - As of July 31, the average price of scrap batteries was 10,250 yuan/ton, the comprehensive cost of large - scale recycled lead enterprises was 17,257 yuan/ton, and that of small - and medium - scale enterprises was 17,482 yuan/ton. The profit of recycled lead refineries was - 1,174 yuan/ton [43][44]. 3.3 Supply Side: Slight Accumulative Increase 3.3.1 Primary Lead: Slight Decline in Operating Rate - In May 2025, global refined lead production was 111.16 tons, down 0.98% month - on - month and up 3.18% year - on - year. In July in China, primary lead operating rate first declined and then recovered. It is estimated that July production was 32.37 tons, down 1.49% month - on - month and up 5.44% year - on - year [54][55]. 3.3.2 Recycled Lead: Slow Resumption of Operating Rate - Since mid - April, recycled lead operating rate declined due to tight raw materials and weak demand. In July, with the approaching peak season and raw material replenishment, the operating rate slowly recovered. However, high scrap battery prices and weak demand led to light spot trading and increasing finished - product inventory. It is estimated that July production was 25.8 tons, up 13.96% month - on - month and 1.30% year - on - year [60]. 3.4 Demand Side: In the Off - Peak Season 3.4.1 Low Downstream Purchasing in the Consumption Off - Peak Season - In July, the lead - acid battery market was in the transition period between off - peak and peak seasons. Some enterprises planned to stock up, but high inventory levels limited the stocking intensity. The operating rate of lead - acid battery enterprises was relatively stable. Electric bicycle battery demand increased, while automobile battery production was based on sales. Due to cost factors, downstream buyers preferred primary lead [68]. 3.4.2 Continuous Closure of the Export Window - In June 2025, lead - acid battery exports were 1,874.46 million units, down 6.69% month - on - month and 20.53% year - on - year. From January to June, cumulative exports were 11,304.30 million units, down 6.61% year - on - year [71]. 3.5 Inventory and Supply - Demand Balance - In July, primary lead production was stable, and recycled lead production increased. Demand entered the peak season, and some downstream enterprises stocked up. Primary lead inventory decreased, while recycled lead inventory increased at the end of the month. Social inventory increased due to high spot - futures spreads. - As of July 31, SMM's five - region lead ingot inventory was 7.30 tons, up 29.66% from the end of June and 72.99% from the same period last year. SHFE lead inventory was 6.33 tons as of July 25, and LME lead inventory was 27.53 tons as of July 31 [75]. 3.6 Market Outlook and Investment Strategy - In July, market trading was average, and lead prices oscillated downward. In August, lead prices are expected to fluctuate and strengthen due to peak - season expectations and raw material issues. - Macroscopically, China's "anti - involution" sentiment still lingers, and the US inflation restricts the Fed's interest - rate cut path. However, the weak employment data in July increased the expectation of a September interest - rate cut, reducing the pressure on non - ferrous metals. The US has reached 10% - 41% tariff rates with more trading partners, and the effective date of reciprocal tariffs has been postponed to August 7. - Fundamentally, raw material issues strongly support lead prices. Lead concentrate remains tight, and scrap battery supply is limited. On the supply side, primary lead refineries will resume production in August, and recycled lead will resume production slowly. On the demand side, it will enter the traditional peak season, but exports may be affected by tariffs [83][84].