GLOBAL ZINC & LEAD WRAP: Lead premiums unchanged amid backwardation; European zinc demand stays low

Lead premiums have so far been unaffected by a widening backwardation as Indian consumers continue to buy from the spot market, while European spot zinc demand remains low amid stable premiums after the weakest consumption data in five years was announced for 2019.

  • London Metal Exchange three-month lead spread was in a $54.50-per-tonne backwardation on Tuesday February 25
  • No sign of physical tightness is seen; live lead stocks on the LME rose to 65,325 tonnes on Tuesday, up from 58,500 tonnes last Tuesday
  • The International Lead and Zinc Study Group (ILZSG) said European refined zinc usage dropped to a five-year low in 2019
  • Lackluster spot trading seen in zinc markets with premiums unchanged across different markets
Indian buying continues despite lead backwardation
Lead tonnages continued to be sold into India during the past week at a stable premium range, even as the backwardated cash-to-three-month spread on the LME widens.
The premium for 99.97% lead ingot on a cif-India basis was stable at $65-120 per tonne as buying interest remained high on a softer commodity price.

The LME three-month lead price has lost 5.4% since the start of 2020, but...


Anna Xu

Julian Luk

Karen Ng

Rijuta Dey Bera

February 26, 2020

11:28 GMT

London, Shanghai, New York