SHANGHAI, Mar. 29 (SMM) -- A recent SMM survey of 18 copper rod and wire producers (total capacity: 2.66 million mt) revealed the following insights:
1) Operating Rates Increase
According to the survey, the average operating rate during March at the 18 domestic copper rod and wire producers was 72.5%, up 4.4% from January levels, and up 5.6% YoY. Average operating rates at large-size producers in March increased 5.7% from January levels, contributing to the improvement in the average. Producers surveyed told SMM that the seasonal peak demand season has arrived, and that operating rates are increasing steadily, despite of a lower-than-expected growth in demand on a monthly basis. Operating rates are expected to improve further in April with increased orders.
2) Raw Material Inventories Stable, Finished Product Stocks Fall
The survey also shows raw material inventories were 21.0% of consumption during March, flat at January levels. Finished products inventories were 11.7%, down 3.3% from January, easing pressure on finished goods stocks. Declines in finished goods inventories were also an indication of improved sales. With regard to stable raw material inventories, producers said they were continuing to purchase goods on an as-needed basis, since fluctuating copper prices is dampening plans to build stocks, resulted in weak spot demand.
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