Report Investment Rating - The investment rating for the lead industry is neutral [4] Core Viewpoint - At present, the processing fee for lead concentrates remains low despite the rising by - product prices, and there are no significant fundamental contradictions. Downstream enterprises are expected to fully recover from the holiday next week, mainly adopting a production - based - on - sales model. The lead price is expected to fluctuate in the range of 16,920 yuan/ton to 17,300 yuan/ton [4] Summary by Directory Lead Market Analysis - **Mine End**: In the week of October 10, the quotation divergence in the imported ore market continued. With the silver price hitting new highs, the processing fee for silver - containing lead concentrates continued to decline. Domestically, some mines completed fourth - quarter pre - sales and suspended quotations, leading to a shortage of market - circulating resources. There were north - south differences in smelter processing fees. The winter - storage order processing fee in Henan and Inner Mongolia was 300 - 500 yuan/metal ton, while in Yunnan and Hunan, due to the decline in raw material inventory, some smelters could only purchase low - silver ore sources at 0 - 200 yuan/metal ton. In the long - term, the supply - demand imbalance of lead concentrates is difficult to improve [1] - **Primary Lead**: In the week of October 10, the operating rate of primary lead smelters in three provinces was stable at 68.47%, a slight increase of 1.98% compared to before the holiday. A smelter in Henan resumed production as planned, increasing output slightly, while a company in Hunan was expected to see a decline in electrolytic lead output in October due to crude lead maintenance. Overall, the operating situation showed regional differentiation [1] - **Recycled Lead**: In the week of October 10, the operating rate of recycled lead in four provinces rose to 34.04%, an increase of 5.63 percentage points. Anhui was the main driving force, with a large smelter resuming production and another entering the baking stage. The operating rate in Anhui is expected to rise by about 10 percentage points next week. The operating rates in other provinces were generally stable. It is expected that the enthusiasm of recycled lead enterprises to start work will only increase limitedly [2] - **Consumption**: In the week of October 10, the comprehensive operating rate of lead - acid battery enterprises in five provinces was 61.71%, an increase of 6.58 percentage points. The resumption of work after the holiday was the main reason for the increase. It is expected that the operating rate will continue to recover next week, and the production rhythm will be more inclined to production - based - on - sales [2] - **Inventory**: In the week of October 10, the total social inventory of lead ingots in five regions was 3.69 million tons, a decrease of 2.05 million tons compared to the previous week. The LME inventory decreased by 450 tons to 237,000 tons [3]

Report Industry Investment Rating - The investment rating for the lead industry is cautiously bullish [3] Core View of the Report - Despite the approaching National Day holiday and weak procurement from downstream battery companies, the lead ore supply remains tight. Coupled with the overall positive impact of the Fed's interest - rate cut cycle on non - ferrous metals, it is recommended to adopt a strategy of buying on dips for hedging with a buying range between 16,950 yuan/ton and 17,000 yuan/ton [3] Summary by Related Catalogs Lead Market Analysis - **Mine end**: In the week of September 27, the domestic lead concentrate market continued to face a supply shortage. The import ore market was seller - dominated with light actual transactions. The processing fee (TC) of imported ore pb60 showed a downward trend. Smelters in Hunan, Inner Mongolia, and Henan reported downward pressure on lead concentrate processing fees. Due to insufficient imported ore arrivals and a tight supply of recycled lead raw materials, the demand gap for lead concentrates widened. Some smelters lowered the pb50TC quote to boost procurement [1] - **Primary lead**: In the week of September 27, the average operating rate of primary lead smelting enterprises was 66.49%, a slight increase of 0.5 percentage points from the previous week. Production in Henan fluctuated, with one enterprise resuming production and another still under maintenance. Small factories in Hunan reduced production slightly due to raw material quality issues, while production in Yunnan was stable. A factory in North China increased production after maintenance, and enterprises in East China have a planned maintenance in the fourth quarter but the specific time is undetermined [1] - **Recycled lead**: In the week of September 28, the operating rate of recycled lead in four provinces rebounded to 27.47%, a rise of 3.73 percentage points from the previous week. This was mainly due to the pre - holiday stocking demand from downstream battery companies, which pushed up the lead price. The stable price of waste batteries helped smelters repair their profits from losses to profits. The operating rate in Anhui increased significantly by 8.25 percentage points. It is expected that the resumption of production will accelerate after the holiday, and the operating rate may continue to rise [2] - **Consumption**: In the week of September 28, the comprehensive operating rate of lead - acid battery enterprises was 71.62%, a slight increase of 0.56 percentage points from the previous week. The demand for electric bicycle batteries improved due to stable supporting orders and pre - holiday restocking by dealers, which drove some enterprises to increase production. However, orders for automotive batteries were weak, and some enterprises planned to take a 5 - 8 - day holiday for the National Day, resulting in low production enthusiasm. With the approaching double festivals, enterprises generally arranged holidays, and the operating rate is expected to decline [2] - **Inventory**: As of the week of September 28, the total social inventory of SMM lead ingots in five regions reached 4.64 million tons, a decrease of 2.05 million tons from the previous week. The LME inventory decreased by 125 tons to 219,425 tons from the previous week [2] Strategy - It is recommended to adopt a strategy of buying on dips for hedging with a buying range between 16,950 yuan/ton and 17,000 yuan/ton [3]