SHANGHAI, Sep 30 (SMM) - SMM has investigated the production arrangements of 55 copper processing enterprises during the National Day holiday, involving a total annual capacity of about 9.38 million mt.
Enamelled wire: The enamelled wire industry remained sluggish in 2022. The operating rates of enamelled wire producers were low, but their in-plant inventories of finished products stood high. At present, many downstream companies are bearish on copper prices. Due to the poor demand, the downstream pre-holiday restocking cannot reach expectations. Many enterprises such as motor factories and home appliance factories are going to have a holiday. Therefore, the holiday time of enamelled wire companies in 2022 will be longer than in previous years, and more companies plan to have a holiday.
Wire and cable: Because of the stable orders from the engineering infrastructure and the State Grid, most large wire and cable enterprises will maintain their normal production during the National Day holiday, and the restocking situation is generally the same as in previous years. Most of the small and medium-sized factories will have a holiday of 3-5 days, and they restock raw materials cautiously. In general, the National Day holiday arrangements and pre-holiday restocking of wire and cable companies in 2022 have not changed much compared with previous years, but the decline in demand from real estate cast a certain impact on wire and cable producers.
Copper cathode rod: In 2022, the National Day holiday arrangements of copper cathode rod producers are different. Most of the copper rod factories that mainly receive orders from enamelled wire customers will have a holiday of 3-4 days, while those generally receive orders from the wire and cable producers will not have a break during the holiday, and they restock raw materials actively before the vacation. Consumption in south China is significantly weaker than that in the east. Large and medium-sized copper rod enterprises in south China will have their holidays and cut the production. In short, most of the copper cathode rod factories in east China will maintain their normal production during the National Day holiday this year, and they mainly restock raw materials on rigid demand.
Secondary copper rod: Most secondary copper rod companies will produce normally during the National Day holiday. In order to ensure the normal production during the holiday, most companies have increased the purchase of copper scrap in two weeks before National Day. However, due to the fall in copper prices before the holiday, the purchasing volume of copper scrap is lower than expected. Only a few copper rod factories have prepared enough raw materials, and most companies are still actively restocking. The number of production days of secondary copper rod enterprises during the holiday depends on their in-plant inventories of raw materials. Owing to the companies’ high enthusiasm for stocking and a strong willingness to produce during the holiday, SMM presumes that the secondary copper rod producers will keep 4-6 days of normal production.
Copper plate/sheet, strip and foil: Orders of copper plate/sheet and strip companies are stable in recent days. And it is expected that the orders will continue to grow in the fourth quarter, but the number of orders will still be lower than the same period last year. In terms of copper foil, thanks to the rapid development of the new energy vehicles industry, the orders of copper foil producers grow quickly, and the industry booms. Most of the copper plate/sheet, strip and foil enterprises will still not suspend their production for holiday this year.
Copper tube: According to the survey, although the copper tube companies expect the consumption in the peak season in the fourth quarter to grow, their restocking of raw materials before the holiday is unfavourable. And the new orders are still slightly insufficient. In 2022, most copper tube companies will have about 3 days off for the holiday, and the number of companies on holiday has increased compared with previous years. Most of the copper tube companies restock on rigid demand, and the overall stock volume has declined YoY.
Copper billet: Affected by real estate and exports, orders of the copper billet producers continue to slump. SMM survey showed that companies in Guangdong, Jiangxi, Zhejiang and other regions will have a 3-4 day holiday, and some firms even have a 7-day holiday. Large companies generally get high in-plant inventories of finished products and raw materials, thus they make less pre-holiday restocking. In general, the continuous decline in terminal demand has put huge pressure on the production of copper billet enterprises, and they will have a longer National Day holiday this year.
Downstream processing companies such as enamelled wire, copper billet, and copper tube are going to have a longer National Day holiday than in previous years. Orders of wire and cable companies are relatively stable. Most of the large ones in Jiangsu and Zhejiang will maintain the normal production during the holiday, and the related copper cathode rod producers may also operate normally. Accordingly, the copper cathode demand in these regions will have not much different from the previous years. The trading will be suspended for 9 days during the National Day holiday in 2022. Under the influence of factors such as the decline in orders of copper tube producers, and the maintenance and holidays of copper cathode rod enterprises in some regions, the overall stocking volume of raw materials in the copper processing companies has not reached the market expectations.
