Operating Rates at Aluminum Wire and Cable Producers Rise Slightly in February

SHANGHAI, Mar. 15 (SMM) -- According to a recent SMM survey, operating rates at 25 domestic aluminum wire and cable producers, representing 1.185 million mt/yr in total capacity, rose slightly in February.

Although operating rates at aluminum wire and cable producers rose slightly in February, cold weather in North China slowed the progress in construction of power projects, thus constraining the recovery of demand for wire and cable. In addition, some producers extended the large-scale maintenance and overhaul of continuous casting and rolling equipment till late February.

State Grid Corporation of China (SGCC) has begun to issue tenders for construction of power projects in February, and wire and cable producers actively participated in the tenders, but these tenders had little positive impact on wire and cable production in February, since these projects may be arranged to be constructed in 2H 2012. Some producers mainly used January inventories to meet wire and cable demand from project construction in February.

SMM believes the construction of power projects in North China will return to normal in March as the weather turns warmer, which will greatly boost demand for wire and cable. Construction of some power projects initiated by SGCC will begin as well. In addition, wire and cable producers will generally resume normal production as the maintenance of equipment has been completed at the end of February. SMM predicts operating rates at aluminum wire and cable producers will improve in March.