SHANGHAI, May 30 (SMM) – With regard to electric wire and cable orders in June, a recent SMM survey of 20 major domestic electric wire and cable producers revealed the following insights:
Only 15% of the surveyed producers are optimistic about the outlook, mostly larger power cable producers. These producers said that as some of their orders have to be delivered in July and August, they will appropriately raise wire and cable output in June. However, owing to sluggish domestic demand, any increase will be limited. Besides, export orders at some producers are stable and tend to increase.
80% of these electric wire and cable producers expect June's orders to remain flat with May. China's manufacturing sector has contracted for seven consecutive months, and consumer climate for power cable, enameled wire, and electronic wire has cooled noticeably. However, Premier Wen Jiabao recently stressed to give more priority to maintaining growth, and Guangdong Province has also asked to step up the pace of railway project applications and progress, boosting demand for wire and cable used in the railway sector. There is also possibility that other provinces will follow suit concerning increases in railway investments. But these investments will not go into markets until the second half of this year. Therefore, these producers will continue to mainly receive urban power network renovation orders and other small orders to maintain production.
The remaining 5% of producers anticipate wire and cable orders will fall. These produces are mainly enameled wire producers, as demand from home appliances and electric machinery industries has weakened.