SMM Cu Survey: Operating Rates for January Down Significantly Due to New Year and Chinese New Year Holidays

SMM Insight 11:32:21AM Feb 06, 2012 Source:SMM

SHANGHAI, Feb. 6 (SMM) –A recent SMM survey of 24 major domestic copper wire rod producers (total capacity: 3.796 million mt/yr) revealed the following insights:

1) Operating Rates for January Down Significantly Due to New Year and Chinese New Year Holidays
Due to both New Year's and the Chinese New Year holiday falling in January, the average operating rate for January at the 24 surveyed copper wire rod producers fell sharply by 12.3% to 61.52%. As January also falls in the seasonal low demand period for copper wire rod producers, and combined with the holiday factor, operating rates fell sharply in this month. 

2) Copper Wire Rod Producers Built More Stocks for Holidays
Raw material inventories during January at the surveyed producers were 14.71% of production, up 5% from the previous month. Producers gradually resumed production in late January following the week-long Chinese New Year holiday, but markets will not fully return to normal until after the Lantern Festival on February 6th. Producers were still prepared for normal inventories for post-holiday production, causing raw material inventories to rise in January. However, inventory levels were still below last year's 20% since producers were cautious about copper prices and bought as needed.  
 

SMM Cu Survey: Operating Rates for January Down Significantly Due to New Year and Chinese New Year Holidays

SMM Insight 11:32:21AM Feb 06, 2012 Source:SMM

SHANGHAI, Feb. 6 (SMM) –A recent SMM survey of 24 major domestic copper wire rod producers (total capacity: 3.796 million mt/yr) revealed the following insights:

1) Operating Rates for January Down Significantly Due to New Year and Chinese New Year Holidays
Due to both New Year's and the Chinese New Year holiday falling in January, the average operating rate for January at the 24 surveyed copper wire rod producers fell sharply by 12.3% to 61.52%. As January also falls in the seasonal low demand period for copper wire rod producers, and combined with the holiday factor, operating rates fell sharply in this month. 

2) Copper Wire Rod Producers Built More Stocks for Holidays
Raw material inventories during January at the surveyed producers were 14.71% of production, up 5% from the previous month. Producers gradually resumed production in late January following the week-long Chinese New Year holiday, but markets will not fully return to normal until after the Lantern Festival on February 6th. Producers were still prepared for normal inventories for post-holiday production, causing raw material inventories to rise in January. However, inventory levels were still below last year's 20% since producers were cautious about copper prices and bought as needed.