Operating Rates of Copper Semis Producers Fell as Expected in April

SHANGHAI, May 16 (SMM) - Chinese copper semis output will be 2.12 million mt in April, down 3.64% month-on-month and up 23.69% year-on-year, according to SMM research. The average operating rate of copper semis producers stood at 75.15% in April, down 1.5 percentage points MoM but up 14.76 percentage points YoY. The MoM decline in operating rates was caused by the decrease in downstream demand.

The average operating rate of copper cathode rod sector fell the most, and the average operating rates of all three copper semis sectors are as follows: copper tube (88.78%)>copper plate/sheet and strip (77.5%)> copper cathode rod (71.73%). The copper tube companies ran at a high capacity in April, but their operating rates still dipped MoM. And these companies generally expected their orders to decrease further; the better-than-expected operating rates of the copper plate/sheet and strip sector were contributed by the increase in orders placed by the transformer and lead frame producers; the reason for the decline in the operating rates of the copper cathode rod companies was that the orders placed by downstream sectors, especially those from the real estate industry, were poor.

Overseas demand continued to fall in April, supported by the customs data showing that in the month, the export value crashed 6.37% month-on-month to $295.4 billion. The domestic demand also decreased again, which was reflected in the 49.2% April manufacturing PMI, slipping into the contraction territory for the first time this year.