Copper Billet Market Experiences "Post-Chinese New Year Syndrome" in February, May "Fully Recover" in March [SMM Analysis]

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       According to SMM, the operating rates of copper billet producers in February 2025 stood at 40.42%, down 1.27% MoM. By scale, the operating rate of large enterprises was 41.42%, medium-sized enterprises 40.36%, and small enterprises 34.36%. Despite the post-holiday restocking demand from downstream sectors and strong performance in fields such as refrigeration, sanitary ware, and electromagnetic wires, the overall operating rate did not rebound significantly due to the following reasons:

       Firstly, affected by the Chinese New Year holiday and the shorter working days in February, most enterprises had an actual production time of only 15-20 days. Although some large enterprises resumed work earlier, the delayed operations of downstream clients constrained production schedules. Enterprises generally reported that capacity recovery rates ranged between 80%-90% compared to the same period last year. Secondly, tight raw material supply also restricted operating rates. The tense trade relations between China and the US reduced US-origin supplies, while in the European market, high brass container rejection rates and rising prices dampened purchase willingness. Additionally, the recent increase in copper prices did not lead to a corresponding rise in brass prices, weakening the willingness to sell and further limiting raw material supply for copper billet producers.

       Looking ahead to March, SMM expects the operating rates of copper billet producers to rebound to 52.84%, up 12.48% MoM. With the arrival of the traditional peak season, enterprises generally hold an optimistic outlook for orders in March and April. Although early March orders slightly underperformed February, robust demand in the refrigeration sector, stable domestic orders, and a significant YoY increase in exports to Southeast Asia were observed. Meanwhile, exports to the US were hindered by the China-US trade war, but enterprises actively adjusted their strategies by registering companies in Southeast Asia and Vietnam to explore new markets, showing strong confidence. Overall, the operating rates of copper billet producers in March are expected to rebound significantly.