Holiday Disruptions Pull Back Operating Rates; Stockpiling Cushions Decline Less Than Expected [SMM Copper Cathode Rod Weekly Review]

The operating rate of major copper cathode rod producers in China was 64.75% this week (September 25-October 1), down 5.15 percentage points WoW but up 5.62 percentage points from expectations. The operating rate pulled back notably this week, mainly due to disruptions from the Mid-Autumn Festival holiday and the first day of the National Day holiday, with most enterprises suspending production on October 1. However, some enterprises actively scheduled production and stockpiled before the holiday, partially offsetting the decline, and the actual operating rate fell less than expected. By sector, end-use industries such as wire and cable and enamelled wire were also affected by the holiday, with operating rates declining to varying degrees. On the inventory side, previously priced and stockpiled orders were gradually picked up, and raw material inventories rose 3.44 percentage points MoM. Downstream cargo pick-up pace continued to slow, and finished product inventories rose 5.93 percentage points MoM. Looking ahead to next week (October 2-October 8), due to disruptions from the National Day holiday, most enterprises will have longer shutdowns, so SMM expects the operating rate of copper cathode rod producers to fall 19.12 percentage points WoW to 45.63% next week.