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[SMM Analysis] consumption of enamelled wire exceeded expectations in March, but take a cautious look at April orders
Apr 10,2020 10:43CST
The content below was translated by Tencent automatically for reference.

SMM, April 10: according to SMM research data, the operating rate of enamelled wire in March was 77.40%, up 52.59% from February, 6.76% higher than expected 70.64%. The main reasons for this are as follows:

As the downstream consumer of enamelled wire, the home appliance industry has resumed production as early as mid-February, and basically achieved more than 80% capacity utilization after March. Stimulated by this, most of the enamelled wire enterprises in the household appliance industry reflected the acceleration of the pick-up speed of household appliance enterprises in March, thus promoting a rapid recovery in their operating rate, which was better than expected. In addition, in order to resume production and resume work as soon as possible, power grids at all levels responded to the call for a full resumption of work in early March, and transformer companies said orders for power systems had increased. On the whole, the higher-than-expected operating rate in March was mainly due to the fact that the enterprises were basically full of production in March and were speeding up the digestion of the backlog of orders in the early stage.

It is estimated that the operating rate of enamelled wire enterprises in April will be 78.42%.

According to SMM, enamelled wire companies are cautious about orders in April, especially pessimistic about orders from the home appliance industry. Due to the impact of the epidemic on a large scale in the world, many countries have closed down Hong Kong and closed the country one after another. many home appliance enterprises reported that their exports had declined by the end of March, and the decline was expected to be even greater in April, and many finished products had to be exported to domestic sales. however, the improvement in the domestic market is limited, and it is estimated that the inventory of upstream raw materials will begin to be reduced in the middle and late April. As a result, many enamelled wire enterprises are worried that the industrial chain will be transmitted to them at the end of April, and are more pessimistic about the number of orders in May. On the bright side, however, orders from these industries are expected to increase in April as capacity utilization in the auto industry increases and investment in the power system increases. But taken together, increases from carmakers and electricity are unlikely to fully offset the decline in the home appliance industry, so the operating rate is expected to rise only slightly by 1.02 per cent in April.

(29 research enterprises with a capacity of 1.006 million tons)

Sample distribution

At present, the enamelled wire industry is mainly distributed in the Yangtze River Delta, Pearl River Delta and Bohai Bay region, most of the enterprises are located in East China, mainly distributed in Zhejiang, Anhui, Jiangsu, Shandong, Shanghai and other places; the second largest area is South China, mainly distributed in Guangdong Province. According to its regional distribution in China, SMM collects market information according to large, small and medium samples in the main distribution centers as far as possible, so as to make the sample distribution more reasonable and reflect the market dynamics more truly.

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production capacity

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