SHANGHAI, Oct. 29 (SMM) – A recent SMM survey of 20 major domestic electric wire and cable producers (total capacity: 987,000 mt/yr) revealed the following insights:

1) Average Operating Rate Down 3.32% MoM in October
The average operating rate during October at domestic electric wire and cable producers fell to  75.42%, down 3.32% MoM and 5.28% YoY. The long Chinese National Day holiday, as well as declining power cable orders, was behind the falling operating rate. The fifth round of bidding projects from the State Grid Corporation of China was offered to markets in late September, but the number of projects was small and delivery dates for some power cable orders were uncertain, which did not allow the projects to begin in October. Falling temperatures also negatively affected electric wire and cable demand in north China. Enameled wire consumption improved during October and should remain strong in November, but enameled wires account for smaller market shares than wires and cables used in the construction and the power sectors, and would not significantly affect operating rates.

2) Raw Material Inventories Down MoM in October
Raw material inventories during October at the surveyed domestic electric wire and cable producers were 20.26% of production, down slightly from September. Raw materials built up in late September for the Chinese Mid-Autumn and National Day holidays were largely consumed. Copper prices fell to RMB 57,000/mt in the second half of October, but most producers were still bearish towards future prices and stayed out of the market.