November Copper Pipe & Tube Operating Rate Surged Both MoM and YoY! December Peak Season Exceeds Expectations [SMM Analysis]

The Operating Rate of Copper Pipe & Tube Reached 81.68% in November

According to the SMM survey, the operating rate of copper pipe & tube enterprises in November was 81.68%, up 9.17 percentage points MoM and up 12.79 percentage points YoY. November is traditionally a peak season for copper pipe & tube, with household air conditioner production schedules also achieving significant MoM and YoY growth. Additionally, with the cancellation of export tax rebates for copper semis and Trump's threats to raise tariffs, both air conditioner manufacturers and copper pipe & tube factories actively rushed to fulfill export orders. Large copper pipe & tube enterprises, saw a MoM air conditioner pipe order growth of around 10%, with an overall MoM growth of 11.26%. Feedback from enterprises indicated that this was mainly driven by export orders from air conditioner manufacturers and increased export demand for copper pipes & tubes. Even companies without prior export business began exploring export-related work. Medium-sized enterprises reported a MoM operating rate increase of 6.21%. Although this growth was less than that of large enterprises, feedback showed that orders for straight pipes and coiled pipes increased, mainly benefiting from high air conditioner production schedules, particularly for domestic sales orders from manufacturers. Small enterprises saw only a 3.07% MoM increase in operating rates, with slight growth in orders for brass pipes, cupronickel pipes, and those related to machinery and military industries, with exports also contributing.

The Raw Material Inventory/Output Ratio of Copper Pipe & Tube Enterprises Was 3.76% in November

The raw material inventory/output ratio of copper pipe & tube enterprises in November was 3.76%, down 0.94 percentage points MoM. As production increased MoM across enterprises, the raw material inventory ratio decreased while maintaining a balanced inventory level was maintained.

The Operating Rate of Copper Pipe & Tube Enterprises Is Expected to Reach 82.79% in December

According to SMM data, the operating rate of copper pipe & tube enterprises is expected to reach 82.79% in December 2024, up 1.11 percentage points MoM and up 10.66 percentage points YoY. Based on the latest household air conditioner production schedule report released by ChinaIOL, domestic production schedules for domestic sales are forecast to grow by 15.0% YoY in December 2024, while those for exports are forecast to grow by 48.5% YoY. Q4 is traditionally a peak season for exports, with manufacturers actively stockpiling for exports driven by overseas Christmas and Black Friday demand, as well as rushing to fulfill export orders before tariff hikes. SMM China copper pipe & tube operating rate in December is also expected to grow by over 10 percentage points YoY.