October Copper Foil Operating Rate Continues to Rise, May Decline in November [SMM Analysis]

According to an SMM survey, the operating rate of copper foil enterprises in October 2024 was 76.24%, up 1.61 percentage points MoM, down 4.49 percentage points YoY. Among them, the operating rate of large enterprises was 81.33%, medium-sized enterprises 58.74%, and small enterprises 67.48%. Specifically, the operating rate of electronic circuit copper foil was 77.70% (up 3.67 percentage points MoM, down 9.35 percentage points YoY), and the operating rate of lithium battery copper foil was 75.45% (up 0.49 percentage points MoM, down 2.01 percentage points YoY). The overall operating rate of the copper foil industry is expected to slightly decline to 75.04% in November. (Survey coverage: 35 enterprises, 58 production sites, total capacity: 1.5156 million mt)

October Copper Foil Operating Rate 76.24%

In October, the overall operating rate of domestic copper foil enterprises continued to rise, reaching a new high for the year. On one hand, the rise in copper prices stimulated downstream purchase sentiment; on the other hand, policies such as trade-in promoted steady growth in end-use demand. Specifically, the operating rates of both lithium battery copper foil and electronic circuit copper foil enterprises increased. For lithium battery copper foil, demand remained robust across all sectors. The power battery market was highly active, and with the phase-out of new energy subsidies, downstream purchase willingness was strong. In the energy storage sector, the year-end grid connection period was approaching, coupled with the advancement of overseas energy storage projects, resulting in robust demand both domestically and internationally. For electronic circuit copper foil, industry orders related to the automotive and server sectors were prominent, and overall demand continued to recover.

October Copper Foil Industry Raw Material and Finished Product Inventories Rise

In October, the finished product inventory/output ratio of the copper foil industry decreased by 0.29 percentage points MoM to 18.57%. With both production and shipments increasing, finished product inventory changes were minimal, but the production increase was more significant. The raw material inventory/output ratio rose by 0.25 percentage points MoM to 17.96%, mainly due to increased production schedules, leading to higher raw material inventories.

November Copper Foil Industry Operating Rate Forecast to Decline to 75.04%

SMM forecasts that in November 2024, the overall operating rate of copper foil enterprises will be 75.04%, down 1.2 percentage points MoM, down 2.76 percentage points YoY. The operating rate of lithium battery copper foil is expected to be 75.20% (down 0.24 percentage points MoM, down 1.22 percentage points YoY). The operating rate of electronic circuit copper foil is expected to be 74.74% (down 2.96 percentage points MoM, down 5.86 percentage points YoY).

SMM expects a slight decline in the overall operating rate of copper foil enterprises in November. For lithium battery copper foil, downstream rush installation is expected to continue, and end-use demand is expected to remain robust. However, for electronic circuit copper foil, the current demand shows a downward trend due to weak industry orders in the consumer electronics sector, which has a high weight in end-use, potentially dragging down the overall operating rate.