How did the copper busbar market perform in Q4? [SMM Analysis]

As a core material in power transmission and distribution systems, copper busbars play a crucial role in power generation facilities and other fields. With one-third of Q4 already passed, how has the downstream market for copper busbars performed recently? What are the expectations of various companies for the future? SMM conducted a survey of relevant companies in Jiangxi, Jiangsu, Zhejiang, Guangdong, and other regions. Some of the survey results are as follows:

Company A: The overall market for copper busbars this year has indeed been quite sluggish, with a significant decrease in order volume compared to last year. Not only us, but many companies are facing the dilemma of scarce orders. When there are orders, we rush to produce; when there are no orders, we can only temporarily halt production. This year is coming to an end, but signs of market recovery are not evident, and there is great uncertainty for next year.

Company B: Currently, our overall order situation remains stable. Although the overall market environment this year is not ideal, we have been actively working to develop downstream customers, so there has been no significant fluctuation in overall order volume compared to the same period last year.

Company C: It is evident that copper busbar orders have decreased. Previously, downstream customers could usually receive a truckload of goods in two days, but now it is difficult to reach this quantity even in a week. This is mainly due to fluctuations in downstream demand, especially when copper prices rise, significantly reducing downstream customers' purchase willingness. Currently, copper prices remain high, and downstream customers' enthusiasm for picking up goods is very low. Moreover, we have learned that many of our peers have already started to cut production. This year, the copper busbar industry faces significant challenges.

Company D: In September, copper busbar orders showed signs of improvement briefly, but after the National Day holiday, order volume returned to mediocre performance. We are currently actively expanding the market in Zhejiang, Jiangsu, and other regions, but progress is not smooth. Additionally, the various policy measures introduced by the state in September have not yet significantly boosted consumption growth, and it is unlikely that consumption will improve significantly in the next two months.

From the survey results, the current demand for copper busbars is weak. According to companies, this is mainly due to the dual impact of a sluggish real estate market and high copper prices. As of September, the real estate development prosperity index only slightly rose to 92.41 but remained at a low level. In the downstream applications of the real estate industry, the construction industry is the most core and extensive field, covering residential, commercial buildings, and public facilities. Copper busbars are mainly used to connect distribution boxes, lighting fixtures, sockets, and other electrical equipment, ensuring power supply and electrical safety within buildings. The decline in real estate prosperity directly leads to a reduction in demand for copper busbars. Additionally, high copper prices have greatly suppressed the purchasing enthusiasm of downstream companies. These two reasons have led to the current poor state of the copper busbar market.

Looking ahead, in September 2024, China's new real estate construction area is expected to be 560.51 million square meters, up 13.3% MoM, down 22.2% YoY; the completed area is expected to be 368.16 million square meters, up 10.2% MoM, down 24.4% YoY. Although the new construction and completion areas in September showed slight MoM increases, they still declined significantly YoY, significantly affecting the demand for copper busbars. As the year-end approaches, the traditional consumption peak season ends, coupled with cold weather leading to early halts in many construction projects and slowing progress in ongoing projects, SMM expects that it will be difficult for new construction and completion areas in the real estate sector to see significant growth within this year, and they may even remain at the current low levels. It will be challenging for the copper busbar market to achieve a significant recovery this year. SMM will continue to monitor market conditions and bring you the latest updates.