End-Use Demand Remains Stable, Most Copper Foil Enterprises Maintain High Operating Rates During the Holiday [SMM Analysis]

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    According to SMM, the operating rate of copper foil enterprises in January 2025 was 67.12%, down 8.52 percentage points MoM, up 8.62 percentage points YoY. Among them, the operating rate of large enterprises was 70.08%, medium-sized enterprises 53.27%, and small enterprises 63.85%. By sector, the operating rate of electronic circuit copper foil was 70.90% (down 6.08 percentage points MoM, up 4.94 percentage points YoY), and lithium battery copper foil was 65.18% (down 9.71 percentage points MoM, up 10.85% YoY). The overall operating rate of the copper foil industry is expected to decline to 65.38% in February 2025.

Operating Rate of Copper Foil Enterprises in January 2025: 67.12%

    The operating rate of domestic copper foil enterprises in January 2025 declined significantly, mainly due to the growth in industry capacity (up approximately 200,000 mt compared to December 2024). However, the actual production and shipments of copper foil enterprises in January remained basically flat compared to December. From the perspective of terminal orders, as the Chinese New Year holiday approached at the end of January, downstream enterprises actively stockpiled ahead of the holiday. Particularly driven by the old-for-new policy, demand in the new energy sector, especially for power applications, continued to show strong performance. Additionally, the rise in copper prices in mid-January and uncertainties brought by tariff policies after Trump's inauguration led to some orders being placed in advance.

Raw Material and Finished Product Inventories in the Copper Foil Industry Rose in January

    In January, the finished product inventory/output ratio in the copper foil industry increased by 1.41 percentage points MoM to 17.75%. Due to optimistic terminal orders, most copper foil enterprises did not halt production or reduce output during the Chinese New Year, leading to a significant increase in finished product inventories during the holiday. The raw material inventory/output ratio rose by 0.17 percentage points MoM to 17.68%, mainly because the rise in copper prices before the holiday prompted enterprises to stockpile raw materials.

Operating Rate of Copper Foil Industry in February 2025 Forecasted to Decline to 65.38%

    SMM forecasts that the overall operating rate of copper foil enterprises in February 2025 will be 65.38%, down 1.74 percentage points MoM, up 23.16 percentage points YoY. The operating rate of lithium battery copper foil is expected to be 63.79% (down 1.38 percentage points MoM, up 26.36% YoY), while that of electronic circuit copper foil is expected to be 68.47% (down 2.43 percentage points MoM, up 18.08% YoY).

    SMM expects the overall operating rate of copper foil enterprises to decline in February, partly due to the Chinese New Year holiday, during which a small number of copper foil enterprises will halt production or reduce output, and downstream enterprises will prioritize inventory digestion after the holiday. Additionally, the shorter production cycle in February contributes to this trend. However, compared to the same period last year, the industry did not experience widespread shutdowns or production cuts around the 2025 Chinese New Year. Most large enterprises maintained relatively high operating levels during the holiday. Overall, terminal orders in February are expected to remain stable without significant declines.

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