High Copper Prices Suppress Peak Season Order Release, Accelerated Destocking May Support Operating Rate Rebound Next Week [SMM Copper Cathode Rod Weekly Review]

Published: Mar 7, 2025 10:47

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[High Copper Prices Suppress Seasonal Order Release, Accelerated Destocking May Support Next Week's Operating Rate Rebound] Copper Cathode Rod: The weekly operating rate of major domestic copper cathode rod enterprises (Feb 28-Mar 6) slightly declined to 73.13%, down 0.53 percentage points WoW and 1.3 percentage points lower than the expected value. March is traditionally a peak season, but in the first week of March, as the US dollar index continued to weaken, copper prices surged again. Under the pressure of high absolute prices, new orders remained suppressed, while the price difference between primary metal and scrap also rose above 1,000 yuan/mt, putting overall consumption under pressure.

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Copper Cathode Rod: The weekly operating rate of major domestic copper cathode rod enterprises (2.28-3.6) slightly declined to 73.13%, down 0.53 percentage points MoM and 1.3 percentage points below the expected value. March is traditionally a peak season, but in the first week of March, as the US dollar index continued to weaken, copper prices surged again. Under the pressure of high absolute prices, new orders remained suppressed, while the price difference between primary metal and scrap rose above 1,000 yuan/mt. Overall consumption was under pressure, with only essential restocking and limited downstream rush to buy amid continuous price rise. This week, the operating rate of copper cathode rod enterprises fell short of expectations. In terms of specific inventories, as market supply tightened and premiums and discounts rose, raw material inventories of copper cathode rod enterprises decreased by 8.08% MoM to 46,650 mt. Meanwhile, with some enterprises undergoing maintenance and operating rates falling short of expectations, finished product inventories also decreased by 5.38% MoM to 63,300 mt. Looking ahead, although current consumption continues to be suppressed by high copper prices and the release of new orders falls short of expectations, under the anticipation of a traditional peak season, most enterprises still expect a gradual improvement in end-use consumption. The operating rate of copper cathode rod enterprises is expected to rise by 3.38 percentage points MoM to 76.50% and increase by 5.18 percentage points YoY in the week of 3.7-3.13.

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

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