Copper Survey - Copper Survey - Operating Rates Unchanged at Copper Cable Producers

 SHANGHAI, Nov. 11 (SMM China) -- A recent SMM survey of 20 major domestic copper cable producers (annual copper consumption: 832 kt, monthly copper consumption: 69.3kt) revealed the following insights:

1) Operating Rates
According to the survey, average operating rates of the 20 producers was 69.0% in November, unchanged from September levels.  Production at copper cable producers was relatively stable compared with falling  rates at other downstream copper producers.  Operating rates dropped at large smelters with capacity >50 kt/yr, but increased slightly at small-medium scale smelters.  
 
2) Inventories of Raw Materials
The survey shows raw material inventories held in November by the 20 producers were down 8.4% from September levels, and accounted for 12.8% of total monthly consumption.  This consumption proportion has fallen for two straight months.  The 20 producers were purchasing on an as-needed basis, and they  acknowledged low raw material inventories were an effective measure to reduce losses.  
 
3) Prospects of Development in the Copper Cable Industry in 2009
Last week, SMM made a survey in major domestic copper cable producers concerning the impact of the slowing global economic growth.  According to the survey, the industry suffered a blow from plunging copper prices during October, and most copper cable producers were operating only according to previous existing orders, and expressed concern future orders may drop. 

When asked about industry prospects in 2009, copper cable producers said the sector has grown rapidly in  recent years, propelled by strong development in grid construction, fixed assets investment, and from the  real estate market, but the impact on China's real economy from the global financial crisis will become more evident in 2009, resulting in depressed demand.  Therefore, the development of the copper cable industry will depend mainly depend on government policies in expanding domestic demand and investment in infrastructure construction.

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