Report Industry Investment Rating - No investment rating provided in the report Core Viewpoints - For lead, due to high lead prices, downstream purchasing enthusiasm has weakened. Meanwhile, refinery profits are good, and refinery operations have rebounded, improving the tight supply situation. As a result, lead prices face upward pressure [1]. - For zinc, overseas structural risks have diminished, and there is insufficient upward momentum for zinc prices. Zinc prices are under pressure. In the medium - term, the fourth - quarter zinc ore supply will tighten, and TC is likely to fall, which will support zinc prices to some extent [1]. Summary by Relevant Catalogs Lead Price and Market Data - SMM1 lead ingot average price was 17,500.00 yuan/ton, up 1.01% [1]. - Shanghai lead futures main contract closing price was 17,650.00 yuan/ton, down 0.06% [1]. - LME3 - month lead futures closing price (electronic trading) was 2,092.00 dollars/ton, unchanged [1]. - The ratio of Shanghai - London lead prices was 8.44 [1]. Fundamental Information - In the central China region, large lead smelters are affected by environmental control, with raw material arrivals slightly affected and the disassembly volume of waste lead - acid batteries declining. If environmental control is lifted on Saturday, the disassembly volume may increase slightly next week [1]. - There is no expected increase in lead concentrate imports, and processing fees are likely to rise. Some smelters have maintenance plans, and the operation of primary lead has a small - scale fluctuation [1]. - The operation of secondary lead has recovered to over 50%, with supply increasing, mainly for delivering previous scattered orders, and the inventory accumulation of refineries is not obvious [1]. - Terminal markets have improved, and the operation of lead - battery enterprises is okay, with demand increasing [1]. Trading Strategy - Hold previous short positions [1]. Zinc Price and Market Data - SMM1 zinc ingot average price was 22,560.00 yuan/ton, up 0.09% [1]. - Shanghai zinc futures main contract closing price was 22,740.00 yuan/ton, up 0.26% [1]. - LME3 - month zinc futures closing price (electronic trading) was 3,072.00 dollars/ton, unchanged [1]. - The ratio of Shanghai - London zinc prices was 7.40, up 0.26% [1]. Fundamental Information - Refineries have sufficient raw material stocks, and zinc ore processing fees are rising. In October, domestic TC may still decline. Refinery profits and production enthusiasm have improved, and monthly production is expected to be around 600,000 tons [1]. - There is no significant improvement in demand. With the continuous deterioration of the Shanghai - London ratio, the zinc ingot export window is expected to open [1]. Trading Strategy - Lightly short at high levels [1].

Report Summary 1. Report Industry Investment Rating No information provided in the document. 2. Core Viewpoints - **Lead Market**: The lead price has been rising due to raw material constraints and reduced production in the secondary lead sector. However, as the market is not yet in the peak - consumption season, there is a risk of inventory accumulation, which may limit the upward momentum of the lead price [1]. - **Zinc Market**: The zinc price has rebounded recently due to positive macro - sentiment and supply - side disturbances. But after the rebound, it has suppressed downstream purchasing enthusiasm, leading to inventory accumulation. The upside potential is limited, and investors should watch for short - selling opportunities when favorable factors disappear [1]. 3. Summary by Relevant Catalogs **Lead Market** - **Price Movements**: On July 3, 2025, the SMM1 lead ingot average price remained unchanged from the previous day, while the Shanghai lead futures main contract closed 0.44% higher than the previous day. The LME3 - month lead futures (electronic trading) closed at $2,063.50 per ton, up 1.20%. The Shanghai - London lead price ratio was 8.32, down 0.75% [1]. - **Fundamentals** - **Supply**: There is no expected increase in lead concentrate imports, and processing fees are likely to rise. Primary lead production is stable with a slight increase. For secondary lead, rising scrap lead - acid battery prices, limited recycler supplies, and strong hoarding sentiment among stores have led to some refineries reducing or halting production due to raw material shortages or cost - price inversions. The inventory of secondary lead products is increasing [1]. - **Demand**: The market is transitioning from the off - season to the peak season, and downstream purchasing is expected to improve, which may reduce the downward pressure on lead prices [1]. - **Industry News**: A secondary lead smelter in the western region with a capacity of 200,000 tons suspended production in May due to equipment failures and is expected to complete repairs by late July. If equipment debugging goes smoothly, it may resume normal production in August. Recently, domestic reduced lead supplies have been tight, and prices have been firm. Overseas crude lead (mostly from Malaysia) arrived at the port this week, with a known trading volume of about 1,000 tons [1]. **Zinc Market** - **Price Movements**: On July 3, 2025, the SMM1 zinc ingot average price increased by 0.05% from the previous day, while the Shanghai zinc futures main contract closed 0.11% lower. The LME3 - month zinc futures (electronic trading) closed at $2,753.00 per ton, up 1.46%. The Shanghai - London zinc price ratio was 8.07, down 1.55% [1]. - **Fundamentals** - **Supply**: Zinc smelters have sufficient raw material inventories, and zinc concentrate processing fees have been rising. The domestic zinc concentrate processing fee increased by 200 yuan/metal ton to 3,800 yuan/metal ton last week, and the imported zinc concentrate processing fee index rose by $9.98/dry ton to $65.25/dry ton. The production of zinc is showing an increasing trend [1]. - **Demand**: The zinc price rebound has reached a level that downstream buyers find unacceptable, and the weak demand has led to mainly just - in - time purchases [1]. - **Industry News**: On July 1, the LME0 - 3 zinc was at a discount of $18.75 per ton, with open interest increasing by 842 to 208,381 contracts [1].