Average Operating Rate at Wire and Cable Producers Up to 87.18% in September-Shanghai Metals Market

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Average Operating Rate at Wire and Cable Producers Up to 87.18% in September

Data Analysis 11:01:16AM Oct 09, 2013 Source:SMM
SHANGHAI, Oct. 9 (SMM) – A recent SMM survey of 20 major electric wire and cable producers (total capacity: 1 million mt) revealed the following insights: 
 
1) Average Operating Rate Up to 87.18% in September 
Our latest survey finds that average operating rate at the participants was 87.18% in September, up 1.19% MoM and 8.45% YoY. Operating rates varied from types of producers. Rate at medium and large producers grew in September. Copper consumption at some producers hit an all-time high. Production at small wire cable producers, however, was disappointing during September, with the rate down by 4.41% to 71.26%. Cash liquidity in late 3Q is tightening, and conditions at small producers are getting harder, highlighting large producers’ advantages. Orders of most national projects and electric power programs were seized by large producers. The investment in power grid and power sources grew 15.62% during the first eight months of 2013, down from the growth seen in the first seven months of 2013. The investment in electric power sector has slowed after rapid growth in 1H 2013. Large producers still have some unfinished orders from metro lines, high-speed railway projects and property market, but demand for copper is note expected to grow significantly compared with 1H 2013. Some producers made earlier-than-schedule production due to the Chinese National Day holiday in early October, causing some copper consumption to be released in advance in September. SMM expects the average operating rate to fall to 84.66% in October. 
 
2) Raw Material Inventories Grow to 29.10% 
Raw material inventories at the surveyed producers were 29.10% of production in September, up nearly 5% MoM. As most producers in our survey need to delivery goods after the Chinese National Day holiday, they built up stocks ahead of the holiday, to ensure the supply. After the holiday, raw material inventories are expected to fall. 
 

 

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Average Operating Rate at Wire and Cable Producers Up to 87.18% in September

Data Analysis 11:01:16AM Oct 09, 2013 Source:SMM
SHANGHAI, Oct. 9 (SMM) – A recent SMM survey of 20 major electric wire and cable producers (total capacity: 1 million mt) revealed the following insights: 
 
1) Average Operating Rate Up to 87.18% in September 
Our latest survey finds that average operating rate at the participants was 87.18% in September, up 1.19% MoM and 8.45% YoY. Operating rates varied from types of producers. Rate at medium and large producers grew in September. Copper consumption at some producers hit an all-time high. Production at small wire cable producers, however, was disappointing during September, with the rate down by 4.41% to 71.26%. Cash liquidity in late 3Q is tightening, and conditions at small producers are getting harder, highlighting large producers’ advantages. Orders of most national projects and electric power programs were seized by large producers. The investment in power grid and power sources grew 15.62% during the first eight months of 2013, down from the growth seen in the first seven months of 2013. The investment in electric power sector has slowed after rapid growth in 1H 2013. Large producers still have some unfinished orders from metro lines, high-speed railway projects and property market, but demand for copper is note expected to grow significantly compared with 1H 2013. Some producers made earlier-than-schedule production due to the Chinese National Day holiday in early October, causing some copper consumption to be released in advance in September. SMM expects the average operating rate to fall to 84.66% in October. 
 
2) Raw Material Inventories Grow to 29.10% 
Raw material inventories at the surveyed producers were 29.10% of production in September, up nearly 5% MoM. As most producers in our survey need to delivery goods after the Chinese National Day holiday, they built up stocks ahead of the holiday, to ensure the supply. After the holiday, raw material inventories are expected to fall.