The "September-October peak season" loses its luster as downstream copper companies remain cautious [SMM Analysis]

With October already halfway through, how has recent downstream copper consumption performed? Traditionally considered a peak consumption season, did the "September-October peak season" perform as strongly as in the past? The SMM survey team investigated downstream-related industries, including power construction, infrastructure, and real estate development. The summary of each industry is as follows:

Company A (Power Construction): Several receiving station projects in September have been fully completed, located in north, east, and south China. In the short term, there are not many new projects, focusing mainly on existing ones.

Company B (Power Construction): The overall performance in H1 was good, especially in the new energy sector's power construction projects, which continued to gain momentum. In contrast, the number of traditional projects decreased. Looking ahead to the remaining months of this year, we expect to undertake some new engineering projects and remain optimistic about market sentiment and financial support.

Company C (Infrastructure): In September, the company had no new projects, working on projects from H1 and earlier. Currently, there is more demand for pipes, wires and cables, and windows and doors, with no new projects expected to start in the short term.

Company D (Infrastructure): Recently, new projects have decreased, downstream demand is average, and there is reluctance to stockpile. Market inventory is high, and peers are also not taking much. Government funding has not improved, leading to fewer projects due to insufficient funds. Labor will adjust with projects, but due to long project cycles, there won't be significant layoffs.

Company E (Infrastructure): There were no significant changes in projects during this year's "September-October peak season." September saw little change from the previous month, with current projects operating normally and none completed yet. There are no new projects coming in, and there are no changes in procurement and personnel. The outlook for the industry is not optimistic.

Company F (Infrastructure): No significant changes were observed during the "September-October peak season." Although H2 is typically a peak construction period, government funding shortages have led to some national highways resuming tolls, and construction companies are mostly cautious, relying on government funding to advance projects. Currently, the number of new projects has decreased, and north-west China's new energy projects, such as wind power, have also been reduced. National-level projects remain relatively stable. The company maintains stable personnel and continues existing projects, expecting more project completions than new starts next year, with personnel arrangements to be decided then.

Company G (Infrastructure): This year's peak season performance is noticeably weaker than last year. There were no new projects in September, and funding and construction remain normal, expected to continue for the next three months.

Company H (Real Estate Development): It is impossible to return to the previous "September-October peak season" period. September had few projects and no new ones, with existing projects not fully completed. The company maintains stable procurement and personnel, currently not considering land acquisition. The industry environment remains severe, with stable housing sales and no significant fluctuations. No significant improvement is expected in the next three months or next year.

Company I (Real Estate Development): In September, there were still five projects under construction, with one nearing completion. Although the inventory of commercial housing is low, sales have not significantly improved after delivery. High-quality housing has sold out, while the remaining housing is slow to sell. There are no plans for new starts before the end of the year, and after existing projects are completed, there will be more focus on saving funds.

Company J (Real Estate Development): In September, there were 5-6 projects under construction, with no new projects expected to start in the next three months. Two projects are expected to be completed by the end of the year, with average construction progress. Due to continued sluggish sales, the "September-October peak season" did not improve, leading to delays in ongoing projects. Currently, funds are tight, and there is reluctance to invest heavily.

Additionally, an SMM survey of some wire and cable companies showed that the growth rate of new orders slowed after the National Day holiday, affecting production operating rates. SMM expects the operating rate of copper wire and cable companies in October to decrease by 1.29 percentage points MoM to 79.43%. Many companies told SMM that there is no significant growth point in market demand for October, and matching September's performance would be ideal, reflecting a lack of confidence in the market's future. In summary, the overall performance of the recent downstream copper consumption market is not satisfactory. Directly affected by funding shortages, the advancement of many projects has been constrained, limiting the volume of new projects and hindering the progress of ongoing projects. Meanwhile, the real estate development prosperity index remains low, with weak real estate market demand and low consumer purchasing willingness, making it difficult to boost sales. The "September-October peak season," traditionally seen as a peak consumption period, did not bring the significant growth expected by the market. Companies across industries generally remain cautious about future market trends and industry prospects. SMM will continue to monitor market conditions to bring you the latest updates.