Enamelled Wire Operating Rate Declined in May

[SMM Shanghai Spot Copper] From a supply-demand perspective, consumption showed improvement compared to earlier. According to SMM, some suppliers reported an increase in downstream enterprise orders. Approaching delivery, the spread between the nearby SHFE copper contracts narrowed slightly. Buoyed by delivery-related support, suppliers’ willingness to hold prices firm rose somewhat, and Shanghai spot copper premiums edged up. In addition, import losses continued to widen, weakening the impetus for overseas cargo inflows, and supply-side increments were limited. Overall, supported by delivery dynamics, Shanghai spot copper quotes against the SHFE 2606 contract are expected to remain at a discount next week, with the discount possibly narrowing slightly.

Copper enamelled wire industry: By month-end, the market had already shown the contradiction of weakening orders and rising inventory. In June, the end-user off-season continued, compounded by high copper prices disturbing market procurement sentiment. During the initial phase, enterprises proactively reduced operations and scaled back production schedules to digest previously accumulated inventory. SMM expects the operating rate of the enamelled wire industry to continue its downward trend in June.