Copper Prices Pull Back, Driving Small Release of Essential Demand, Yet Brass Billet Operations Struggle to Escape Off-Season Weakness Pattern [SMM Brass Billet Market Weekly Review]

       This week (8.14‑8.20), the weekly operating rate of SMM's copper billet sample enterprises was 48.74%, up 0.22 percentage points MoM and down 1.09 percentage points YoY. Domestic copper prices pulled back slightly this week, releasing some rigid demand orders from downstream, which drove a minor recovery in production at copper billet enterprises. However, the industry remained in the traditional consumption off-season overall, with no significant rebound in operating rates. On the raw material side, the tight supply situation of recycled brass has not fundamentally improved. Despite the pullback in copper prices, raw material prices stayed high. Days of raw material inventories at sample enterprises stood at 3.61 days, remaining at a low level. On the demand side, benefiting from lower copper prices, some downstream end-users conducted small-scale restocking at lower prices, releasing rigid demand orders and driving a slight reduction in finished product inventories. Days of finished product inventories at sample enterprises this week were 4.96 days, edging down MoM. However, overall end-use demand remained weak, and the traditional off-season environment remained unchanged, with limited growth in new orders.

       Looking ahead to next week (8.21‑8.27), the market will remain in the traditional consumption off-season, with a lack of strong drivers for order recovery at the terminal level. Although copper prices have pulled back, they remain at high levels overall. The tight supply of recycled brass raw materials continues, and high raw material costs keep squeezing processing enterprise profits, suppressing their production enthusiasm.SMM expects the operating rate of copper billet sample enterprises to edge down further to 48.58% next week, down 0.93 percentage points YoY.