SHANGHAI, Jan. 24 (SMM) - The latest SMM survey of 18 major copper wire rod producers (total capacity: 3.28 million mt) revealed the following insights:
1) Operating Rates Drop Further in January
According to the SMM survey, the average operating rate at the 18 major domestic copper wire rod producers was 64.81% in January, down 4.07% from December’s 68.88%. As the Chinese New Year holiday approaches, orders received by copper wire producers continue to fall, especially from electric wire and cable producers. The decline of orders from the enameled wire industry was slower than order from the electric wire and cable sector, but most surveyed producers say operating rates will fall further in February due to the holiday.
2) Raw Materials and Finished Goods Inventories Both Up in January
The SMM survey also shows raw material inventories at copper wire rod producers in January were up 2.89% from December levels, while finished goods inventories were 3.01% higher than December. One major reason behind rising raw material inventories was stock replenishment needed for production during the Chinese New Year holiday. Producers also increased finished goods inventories to meet demand during the holiday period. Rising copper prices recently depressed sales of goods, also resulting in higher finished goods inventories.
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