Operating Rates of Aluminium Wire and Cable Producers Weakened in January amid CNY Holiday and Poor Orders

SHANGHAI, Feb 14 (SMM) - According to SMM survey, the average operating rate in the aluminium wire and cable sector stood at 34.4% in January, down 5.9 percentage points MoM and 0.6 percentage points YoY. The average operating rate lost 9.2 percentage points MoM to 38.5% for large producers, fell 4.3 percentage points to 29.3% for mid-sized producers, and stabilised at 43.5% for small producers.

The operating rates of wire and cable producers continued to drop in January as most enterprises took holidays for 7-10 days for CNY. However, the in-plant inventory increased with falling orders from power grid sector. In addition, some producers reported to produce in advance for goods delivered in February and thus the operating rates may remain low in February. In January, the operating rates of wire and cable producers in Jiangsu and Zhejiang were relatively high while factories in Heilongjiang, Jilin, and Liaoning reduced the production amid poor orders. In terms of overseas demand, China exported 13,700 mt of aluminium wire and cable in December, up 17.8% MoM and 31.2% YoY. In 2022, China's aluminium wire and cable exports increased 24% to 178,000 mt.

SMM comments: Entering February, domestic aluminium wire and cable companies have resumed the production. But the orders picked up slowly without bid demand from large-scale projects of the State Grid. SMM expects the average operating rate of wire and cable producers will decline in February based on the production scheduling.