SMM: Analysis of the Copper Wire Rod Market in 2025 and Future Outlook [SMM Copper Industry Conference]

On April 22, at the CCIE-2025SMM (20th) Copper Industry Conference and Copper Industry Expo - Electrical Power Transmission and Distribution Industry Forum, jointly organized by SMM Information & Technology Co., Ltd., SMM Metal Trading Center, and Shandong Aisi Information Technology Co., Ltd., with Jiangxi Copper Corporation and Yingtan Land Port Holding Co., Ltd. as the main sponsors, Shandong Humon Smelting Co., Ltd. as the special co-sponsor, and Xinhuang Group and Zhongtiaoshan Nonferrous Metals Group Co., Ltd. as co-sponsors, Long Huachen, a senior copper analyst at SMM, analyzed the copper wire rod market for 2025 and provided an outlook for its future. Chapter 1: Analysis of the Copper Cathode Rod Market in 2025 1.1 SMM Copper Cathode Rod Equipment Capacity Distribution Map SMM predicts that China's copper cathode rod equipment capacity will reach approximately 17.67 million mt in 2025. East China and South China are both major consumption and production areas, with East China accounting for 50.8% of the national copper rod capacity, of which Jiangsu accounts for 28%. 1.2 New and Expanded Capacities Continue to Be Released from 2023 to 2025, with Slowing Growth in Copper Cathode Rod Production ►SMM Analysis: • China's copper cathode rod capacity increased from 11.5 million mt in 2019 to 17.67 million mt in 2025, with an average annual compound growth rate of 6.41%; production increased from 7.18 million mt to 10.3 million mt, with an average annual compound growth rate of 4.66%. • With the commissioning of new copper cathode rod capacities, the release of additional capacities has made overcapacity in the industry more significant. By the end of 2025, the capacity is expected to reach 17.67 million mt/year, with further expansion plans still in place. 1.3 Supply Surplus Pressures Copper Rod Processing Fees & Weak Consumption Keeps Copper Cathode Rod Operating Rates Below Expectations ►SMM Analysis: • The copper rod industry has long faced overcapacity, putting pressure on processing fees. In 2024, the surge in copper prices significantly impacted processing fees, leading to negative processing fees under pressure from premiums and discounts. After copper prices fell back from highs, processing fees gradually returned to normal levels. Chapter 2: Analysis of the Secondary Copper Rod Market in 2025 2.1 SMM Secondary Copper Rod Equipment Capacity Distribution Map SMM predicts that China's secondary copper rod equipment capacity will be approximately 6.77 million mt in 2025, a decrease of 1.3 million mt from 8.07 million mt in 2024. Effective capacity will be 4.89 million mt, a decrease of 650,000 mt from 5.54 million mt in 2024. The main production areas are Jiangxi, Anhui, Hubei, and Henan. Jiangxi accounts for 34.22% of the national copper rod capacity, while Anhui accounts for 18.28%. 2.2 Secondary Copper Rod Industry Operating Rates Continue to Decline ►SMM Analysis: • Reverse Invoicing: The State Taxation Administration announced that, starting from April 29, 2024, qualified resource recycling enterprises can issue invoices to natural persons selling scrap products, implementing "reverse invoicing." This measure aims to promote resource recycling and reuse while optimizing tax collection and management. • Fair Competition Review Regulations: On June 13, 2024, the State Council issued the "Fair Competition Review Regulations" (hereinafter referred to as the "Regulations"), which will take effect on August 1, 2024. The main entities of fair competition review include administrative agencies and drafting units, involving laws, administrative regulations, local regulations, rules, normative documents, and specific policy measures related to operators' economic activities. 2.3 Changes in the Secondary Copper Rod Industry: Shifting to Copper Anode Production ►SMM Analysis: • A significant portion of domestic copper anode capacity uses secondary copper as raw material. The total sample capacity of SMM is 3.31 million mt, with copper anode made from scrap accounting for 2.04 million mt, or 61.6%. This is mainly distributed in Jiangxi (45%), but the actual capacity utilization rate is low. 2.4 Analysis of Production Costs for Secondary Copper Rod and Copper Anode ►SMM Analysis: • Production costs for secondary copper rod (excluding production losses): 583 yuan/mt; production costs for copper anode (excluding production losses): 468 yuan/mt. • The key factor in secondary copper rod plants' production preference: the discount for secondary copper rod (e.g., -1,200 yuan/mt) vs. the discount for copper anode (e.g., -500 yuan/mt). Plants tend to produce the product with the smaller discount. Chapter 3: Outlook for the Future Copper Rod Market 3.1 The Road to Recovery for Infrastructure and Real Estate Markets Remains Distant ►SMM Analysis: • The growth rate of fixed asset investment has declined year by year, and the growth rate of real estate completion area has significantly dropped. The use of copper rods in traditional industries is unlikely to return to its former glory. 3.2 Accelerated Growth in Power Grid Investment and Steady Growth in the New Energy Industry The analysis covers the completion of State Grid Corporation of China's investment and construction, copper tender volumes, recent NEV sales, and wind and PV new energy installations. 3.3 Copper Cathode Rod Exports Seek New Paths, Secondary Copper Rod Shifts to Copper Anode Production • Copper rod exports increased significantly in 2024, and it remains to be seen whether high growth can continue after the cancellation of export tax rebates. • With tight supply of copper concentrates in China and increasing demand for copper anodes, more secondary copper rod enterprises will shift to copper anode production. Click to view the special report on the CCIE-2025SMM (20th) Copper Industry Conference and Copper Industry Expo.