SHANGHAI, Aug. 16 (SMM) –Based on a recent SMM survey of major domestic copper tube/pipe producers, the seasonal low demand period has significantly depressed demand for copper tubes/pipes.
In the 19 surveyed copper tube/pipe producers, about 57% producers said orders during August will fall further from July. As these producers are mainly involved with refrigeration pipes, the low demand season in Q2 is the main factor behind the August orders drop. Given volatile copper prices, downstream enterprises were hesitant to place orders before a clearer price trend was visible, partially affecting August orders at copper tube/pipe producers.
About 32% producers in the survey expected August orders to hold flat with July levels. These producers are mostly producing water pipes and seawater desalination pipes, and a small number of them are refrigeration pipe producers. As demand for water pipes and seawater desalination pipes is little affected by a low or high season, demand for these two producers remains stable at present. Furthermore, despite the low demand season, some refrigeration pipe enterprises regularly cooperate with a few big air conditioner producers, keeping orders stable.
Only 11% of these surveyed producers are optimistic towards orders in August. According to enterprise feedbacks, operating rates during July were not good, so the latest round of copper declines will provide a good opportunity for enterprises to increase orders in August.