SHANGHAI, Apr 24 (SMM) – Poorer downstream consumption from real estate, home appliances, and automobiles may continue to drag on the operation across copper material producers, especially processors of copper strip, plate, and foil in April, an SMM survey found on Tuesday April 23.
SMM expects April's operating rate across plants of copper strip, plate, and foil to lose 3.69 percentage points from a year earlier, and stand at 77.71%. The rate dropped 8.26 percentage points on the year to 74.51% in March.
On a yearly basis, operating rates across copper material producers are likely to fall 3.3 percentage points, and average 80.8% in April. Those producers operated at an average rate of 77.8% in March, down 3 percentage points from March 2018.
For the second quarter, a traditional high season is expected to improve consumption and pull up operating rates on a monthly basis, though the rates may stand weaker than a year ago.
The National Development and Reform Commission will roll out new consumer spending incentives for cars, home appliances, and consumer goods as it released a draft on April 18 to seek public comments.
Data from the National Bureau of Statistics (NBS) showed that floor space of completed buildings slid 10.8% year on year in the first quarter. This extended the downside trend from 2018, and depressed copper consumption, as the material is widely used in construction to form wire, cables, pipe, tubes, and transformer equipment.
The commitment to tighten regulations on the housing market was reiterated at a working meeting of the Political Bureau on Friday April 19.
Despite the expansion of new energy vehicle market, the slowdown in the traditional auto market dragged on overall copper consumption.
Domestic sales of passenger vehicle decreased 6.88% year on year and stood at 2.02 million units in March, according to data from the China Association of Automobile Manufacturers (CAAM). This reduced sales in January-March by 13.72% on the year, to 5.26 million units.