SHANGHAI, Aug 11 (SMM) - Operating rates of copper billet producers stood at 57.64% in July, down 1.28 percentage points month on month and 8.75 percentage points year on year.
There was still backlogged billet orders for June in July, and the overall output did not drop much from June, which was slightly higher than market expectations.
The copper-zinc alloy billet industry is in the off season. The demand stood weak from plumbing, sanitary ware, small appliances, communications, and refrigeration sectors. The demand from refrigeration fell significantly. The overall orders for the billet declined.
Operating rates of copper billet producers are expected to stand at 55.09% in August, down 2.55 percentage points month on month and 14.43 percentage points year on year.
The orders by small household appliances and sanitary wares are hard to improve due to the high export freight rates and the port congestion in the pandemic.
The operating rates are expected to hit bottom in August after the backlog orders are delivered.
In the off-season, billet companies controlled inventory to avoid capital backlog, and the inventories of finished products were normal. In terms of raw materials, the imported brass was more expensive than domestic resources, and producers were more willing to purchase domestic brass, leading to a tight supply. But the production could be maintained. The supply shortage of brass was relatively slighter than cliff.