Supply and Demand Under Dual Pressure; Brass Billet Operating Rate Continues to Pull Back Slightly [SMM Brass Billet Market Weekly Review]

        This week (7.17-7.23), the SMM weekly operating rate for brass billet enterprises was 49.13%, pulling back slightly by 0.48 percentage points WoW, as industry production remained under pressure. The tight supply of recycled brass raw materials failed to ease, raw material procurement prices stayed high, and sample enterprises' days of raw material inventories stood at 3.69 days, remaining at a low level. This week's brass billet production similarly edged down. This week, SHFE copper prices exhibited a consolidation pattern at highs, with the market giving back earlier gains towards the end of the week. Intensified price fluctuations further disrupted market trading pace. The traditional off-season characteristics of downstream industries continued to deepen. Order volumes in key end-user sectors such as refrigeration, sanitary ware, and hardware sustained their downward trend, and the market lacked effective demand growth. Downstream buyers remained cautious, mostly maintaining a pattern of sporadic, need-based procurement. The destocking pace of brass billet finished products was hindered, and sample enterprises' days of finished product inventories stood at 5.09 days.

        Looking ahead to next week (7.24-7.30), short-term downstream off-season conditions are unlikely to see any substantial improvement, and end-user orders are not expected to show signs of recovery in the near term. Combined with the persistent tightness in raw material supply and elevated raw material costs, it will be hard to boost enterprises' production enthusiasm. SMM expects the operating rate for sample brass billet enterprises to edge down further to 48.78%.