According to SMM research, in January 2024, the operating rate of copper foil enterprises was 58.50%, a decrease of 10.48 percentage points compared to the previous month, and a significant drop of 22.15 percentage points year-on-year. The operating rate of large enterprises was 60.43%, that of medium-sized enterprises was 50.81%, and that of small enterprises was 62.54%. Among them, the operating rate of electronic circuit copper foil was 65.96%, down by 10.38 percentage points month-on-month; the operating rate of lithium battery copper foil was 54.33%, down by 10.3 percentage points month-on-month. It is expected that the overall operating rate of the copper foil industry will be 47.14% in February. In January, the sample capacity of copper foil enterprises was re-optimized and adjusted, with additional capacity from expansion enterprises in the fourth quarter. (Research enterprises: 36, total capacity: 1.4856 million tons)
In January, the operating rate of copper foil enterprises was 58.50%. From the demand side of lithium battery copper foil, in January, many small and medium-sized enterprises in the digital and small power battery sectors were mostly in a state of reduced or suspended production, with limited pre-holiday stocking demand. On the power side, the pre-holiday replenishment demand was driven by the gradual ramp-up of new terminal projects, slightly slowing down the industry's reduction. In the overseas market, demand for pickup was generally weak due to the digestion of previous inventories by battery cell factories. In the past two years, there has been some cyclicality in the lithium battery copper foil-lithium battery sector, with severe overcapacity, making it difficult for the industry's operating rate to return to previous highs. From the demand side of electronic circuit copper foil, although the operating rate of most domestic copper clad laminate factories in January was around 60%, because pre-holiday terminal replenishment demand did not deteriorate continuously, most copper clad laminate companies stated that they would "lightly stock up for the holiday", with stocking quantities lower than in previous years.
In January, the raw material inventory-to-output ratio of copper foil enterprises was 18.30%, and the finished product inventory-to-output ratio was 27.93%. In January, both the raw material inventory-to-output ratio and the finished product inventory-to-output ratio of the copper foil industry increased, but the increase in finished product inventory was extremely limited, as it is expected that post-holiday consumption will continue to be weak, and both upstream and downstream of the copper foil industry chain will have less inventory than the same period last year. It is expected that the overall operating rate of the copper foil industry will be 47.14% in February, a decrease of 11.36 percentage points compared to the previous month, and a year-on-year decrease of 32.1 percentage points. It is expected that the operating rate of lithium battery copper foil will be 43.42% in February, down by 10.92 percentage points month-on-month, marking a departure from the past for China's lithium battery copper foil industry. As the main process in the electrolysis-based copper foil industry, a large-scale shutdown phenomenon is usually rare during the Spring Festival period. However, during the 2024 Spring Festival period, due to weak downstream consumption and poor sustainability of new orders, most domestic copper foil bases experienced partial equipment shutdowns for maintenance, resulting in a new low in operating rates. It is expected that the operating rate of electronic circuit copper foil will be 53.80% in February, down by 12.15 percentage points month-on-month. With most terminal manufacturers entering the holiday season in February, and with the seasonal downturn, the operating rate of electronic circuit copper foil continues to decline, and it is also expected that due to the accumulation of finished product inventory during the Spring Festival period, the industry's operating rate in March will be less optimistic.
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