Supply and demand in the copper foil market remained stable, with the impact of tariffs not yet significantly transmitted to the industry [SMM Analysis]

SMM 9 May NEWS:

According to SMM, the operating rate of copper foil enterprises in April 2025 was 71.51%, up 0.31 percentage points MoM and 0.60 percentage points YoY. Among them, the operating rate of large enterprises was 74.89%, that of medium-sized enterprises was 54.91%, and that of small enterprises was 70.33%. Specifically, in different fields, the operating rate of electronic circuit copper foil was 76.48%, down 0.08 percentage points MoM and 1.05 percentage points YoY, while the operating rate of lithium battery copper foil was 68.95%, down 0.42 percentage points MoM but up 1.65 percentage points YoY. It is expected that the overall operating rate of the copper foil industry will slightly decline to 71.42% in May 2025.
Operating rate of copper foil enterprises in April 2025: 71.51%
The copper foil industry market was relatively stable in April 2025. However, from the perspective of the operating rate, there was a slight pullback in the operating rates of domestic lithium battery and electronic circuit copper foil. For lithium battery copper foil, orders from the downstream power sector remained relatively stable, but orders from the ESS sector weakened. This was partly due to the cancellation of the "mandatory energy storage allocation" policy in China and partly due to the impact of tariff policies on overseas orders of some enterprises. For electronic circuit copper foil, the overall performance of downstream 3C electronics and other consumer sectors was optimistic, and there was also demand for frontloading exports due to concerns about tariff impacts.

Raw material and finished product inventories in the copper foil industry remained stable in April
In April, the finished product inventory/output ratio of the copper foil industry rose by 0.15 percentage points MoM to 16.59%, while the raw material inventory/output ratio fell by 0.22 percentage points MoM to 16.93%. After the industry experienced destocking in finished product inventories in March, supply and demand remained relatively stable in April, and there were no significant changes in enterprises' production schedules for May. Therefore, the industry's raw material and finished product inventories were at normal levels.

Forecast for the operating rate of the copper foil industry in May 2025: A slight decline to 71.42%
SMM forecasts that in May 2025, the overall operating rate of copper foil enterprises will be 71.42%, down 0.09 percentage points MoM and 0.85 percentage points YoY. It is expected that the operating rate of lithium battery copper foil in May will be 68.55%, down 0.40 percentage points MoM but up 1.37 percentage points YoY. The operating rate of electronic circuit copper foil in May is expected to be 77.00%, up 0.52 percentage points MoM but down 4.63 percentage points YoY.
SMM expects that the overall operating rate of copper foil enterprises will continue to decline slightly in May. For the copper foil industry, the export volume of the products themselves is relatively small, so it will still take some time for the significant impact of tariffs to be transmitted. In terms of specific segments, for lithium battery copper foil, orders from the downstream power sector are expected to remain stable, but the reduction in orders directly exported to the US from the ESS sector will drag down the demand for copper foil. For electronic circuit copper foil, most raw materials are exported to Taiwan and Southeast Asia, processed into end-user electronic products, and then exported to the US. As the current tariff policy is not yet fully clear, there is still frontloading of exports in the downstream sector, and it is expected that the demand for electronic circuit copper foil will remain high.