[SMM Analysis]Refined Copper Rod Exports Showed Steady YoY Growth in January-February: Is Processing Trade a Flash in the Pan or the Future Mainstream?

Since the end of November 2024, the export market for copper wire rod has gradually completed the transition from Ordinary Trade to processing trade. Whether the exponential growth of processing trade is a temporary response to market changes or the future mainstream of the market, the import and export data for January-February 2025 has been released by the customs platform. SMM will analyze the data in combination with the actual market situation as follows:

According to customs data, the exports of refined copper rods (>6mm) under processing trade continued to grow in January-February, following a MoM increase of 12.2x and 9.4x in December for processing with imported materials and processing with supplied materials, respectively. The total volume also increased month by month. Specifically, the total exports of refined copper rods (>6mm) in January 2025 rose to 4,364.3 mt from 3,903.1 mt in December 2024, up 11.8% MoM. In February 2025, the total exports further increased by 14.6% MoM from January 2025. The total exports in January-February 2025 reached 9,364.65 mt, up 43.9% YoY compared to the same period in 2024. Notably, driven by policies, significant changes occurred in processing with imported materials, processing with supplied materials, and ordinary trade. The exports of refined copper rods (>6mm) under processing with imported materials in January-February 2025 reached 8,844 mt, up nearly 105x YoY, while the exports under processing with supplied materials increased from 0 to 45 mt, and ordinary trade accounted for only 2% of the same period. Additionally, the volume of Entrepot Trade by Customs Special Control Area decreased to 0 in February as the market adjustment period ended.

On the other hand, exports of refined copper wire (≤6mm) in January-February 2025 also increased significantly compared to December 2024, with January and February up 60% and 7% MoM, respectively. On a YoY basis, the total exports of refined copper wire (≤6mm) in January-February 2025 increased by 51.47% compared to January-February 2024. Similarly, driven by policies, the processing trade (import processing, export processing) and Ordinary Trade volumes of refined copper wire (≤6mm) in January-February 2025 also showed significant changes. The export volume of import processing for refined copper wire (≤6mm) in January-February 2025 was 7,668.2 mt, up 12.4 times YoY, while export processing increased by 18.69% YoY, and Ordinary Trade decreased by 57% YoY.
In summary, based on the data and market realities, the export market for copper wire rod has now fully shifted to processing trade, rather than being a short-lived phenomenon under tax policy changes. Mainstream enterprises in the market have largely maintained stable export volumes. At the same time, as more refined copper rod enterprises apply for processing manuals and actively expand overseas markets, coupled with a significant increase in oxygen-free rod exports, the export volume in January-February 2025 maintained growth both YoY and MoM. With the export window open, it is expected that high export volumes can be maintained in the future. The export volume of copper wire rod in 2025 may exclude the impact of policy changes and achieve a total volume similar to that of 2024.