Industry Dilemma Under High Copper Prices: Dual Decline in Operating Rates of Copper Cathode Rod and Secondary Copper Rod, Inventory Accumulation [SMM Analysis]
Copper Industry Dilemma Under High Copper Prices: Dual Decline in Operating Rates of Refined and Secondary Copper Rods with Inventory Accumulation [SMM Analysis]: As copper prices continued to rise, under the backdrop of consumption being suppressed by absolute prices and the operating rate of secondary copper rod production passively decreasing during a policy observation period, the discount of secondary copper rod against copper futures has been on a downward trend throughout March. The price difference between copper cathode rod and secondary copper rod has reached its highest level since September 2024. Against this backdrop, how is the current market for refined and secondary copper rods performing? Has the supply of anode plates increased? A detailed analysis follows:
With copper prices rising, the discount of secondary copper rod in Jiangxi against copper futures is shown in the figure below. First, from the perspective of the secondary copper market, the performance of secondary copper rod and anode plants is as follows:
As copper prices continued to climb, the supply of secondary copper increased slightly compared to before. Although most suppliers held back cargoes due to bullish expectations, leading to tight procurement of secondary copper raw materials, the high absolute prices have consistently suppressed end-use consumption. Downstream cargo pick-up from secondary copper rod enterprises was also weak, resulting in a decline in demand for secondary copper raw materials. Additionally, with the initial finalisation of the reverse invoicing policy, the market's wait-and-see sentiment has also restrained the operating rates of secondary copper rod plants. According to SMM statistics, the weekly operating rate of secondary copper rod plants has declined for three consecutive weeks. Against the backdrop of weakening demand and sluggish consumption, the discounts of secondary copper rod against copper futures have continuously decreased, widening the price spread between anode processing fees and the discounts of secondary copper rod against copper futures, making anode processing fees more advantageous (as shown in the figure). According to SMM, since early March, many secondary copper rod enterprises have started producing anodes.
From the perspective of refined copper rods, under the pressure of high absolute prices and the expanding price difference between refined and secondary copper rods, both orders on hand and new orders for refined copper rod enterprises have decreased to varying degrees. Many refined copper rod enterprises reported that some downstream consumption has already shifted to secondary copper rods. However, according to SMM, finished product inventories at secondary copper rod enterprises remain high, so the overall market focus is still on inventory reduction. As shown in the figure, SMM data indicates that the finished product inventories of refined copper rod enterprises have risen significantly again. Operating rates may continue to decline, and it is noteworthy that refined copper rod traders have once again adopted a low-price competition strategy, which may further increase the pressure on refined copper rod enterprises to sell their products.
In summary, as copper prices continue to rise, although the expanding price difference between refined and secondary copper rods gives secondary copper rods more economic advantages, the limited shift in consumption has led to high finished product inventories for both refined and secondary copper rod enterprises. The operating rates of both types of enterprises have declined, and overall consumption in the copper rod market is being suppressed by high copper prices, leading to increased sales pressure. If copper prices rise further, the suppression of future consumption may intensify. Under the conditions of a policy observation period for secondary copper rods and persistently weak downstream consumption for refined copper rods, when the operating rates of refined and secondary copper rod enterprises will rebound remains dependent on the downstream acceptance of copper prices.
데이터 출처 설명: 공개 정보를 제외한 모든 데이터는 SMM이 공개 정보, 시장 커뮤니케이션 및 SMM 내부 데이터베이스 모델을 기반으로 가공한 것입니다. 본 자료는 참고용이며 의사결정 권고를 구성하지 않습니다.
문의 사항이 있거나 자세한 정보를 원하시면 아래로 연락해 주시기 바랍니다: lemonzhao@smm.cn
리서치 보고서 열람 방법에 대한 자세한 내용은 아래로 문의하시기 바랍니다:service.en@smm.cn
관련 뉴스
5분 전
중국 2차 동 양극 생산업체 가동률 반등
더 보기
중국 2차 동 양극 생산업체 가동률 반등
[SMM 동 양극 시장] 이번 주, 이전 태풍의 영향을 받았던 일부 동 양극 생산업체들이 생산을 재개했습니다. 8월 28일부터 9월 3일까지 SMM의 중국 재생 동 양극판 생산업체 주간 가동률은 전주 대비 5.75%포인트 반등한 50.40%를 기록했습니다. 다음 주에는 전주 대비 3.69%포인트 상승한 54.09%에 이를 것으로 예상됩니다.
5분 전
7분 전
동제련 기업들은 원자재 재고를 낮게 유지하는 반면, 완제품 재고 소진에는 어려움을 겪고 있다
더 보기
동제련 기업들은 원자재 재고를 낮게 유지하는 반면, 완제품 재고 소진에는 어려움을 겪고 있다
[SMM 황동 빌렛 속보] SMM에 따르면, 현재 재생 황동의 공급 부족 상황은 변함이 없으며, 원자재 가격은 높은 수준에서 안정세를 보이고, 가공 마진은 지속적으로 압박을 받고 있다. 이번 주 표본 기업의 원자재 재고 일수는 3.52일로 낮은 수준을 유지했다. 그러나 하류 구매자들은 주로 즉시 조달에 그쳤고, 적극적인 재고 보충 의지가 약해 완제품 재고 소진이 다시 한번 지연되었다. 이번 주 표본 기업의 완제품 재고 일수는 5.11일로 집계되었다.
7분 전
9분 전
동제품 생산업체들의 가동률은 다음 주 소폭 반등할 것으로 예상된다
더 보기
동제품 생산업체들의 가동률은 다음 주 소폭 반등할 것으로 예상된다
[SMM 황동 빌렛 속보] 다음 주(9.4-9.10)를 전망하면, 구리 가격은 단기적으로 고점에서 횡보할 가능성이 있으나 저가 물량이 점진적으로 소화된 후 하류의 강성 수요 주문이 소폭 방출될 것으로 예상된다. SMM은 가동률이 전월 대비 0.57%p 상승한 49.06%로 소폭 반등할 것으로 전망한다.
9분 전
