This week (May 23-29), the operating rate of SMM copper wire and cable enterprises stood at 78.67%, down 3.67 percentage points WoW and up 2.74 percentage points YoY, falling short of the expected operating rate by 2.31 percentage points. The operating rate of copper wire and cable enterprises has declined for five consecutive weeks, with orders on hand decreasing compared to the previous period. The current market environment, characterized by "high copper prices + low profits + long payment terms," has exacerbated customer fatigue, resulting in muted market purchasing sentiment. Despite the approaching Dragon Boat Festival, downstream stocking demand remains minimal. From an inventory perspective, the sample raw material inventory this week was recorded at 17,550 mt, down 0.85% WoW, while finished product inventory reached 20,550 mt, up 7.37% WoW. This indicates a significant slowdown in cargo pick-up speed by end-users. By sector, SMM has only heard that orders from the State Grid sector have remained stable, with offshore cables and high-voltage orders generally performing well. However, medium- and low-voltage products in the construction and real estate sectors continue to exhibit mediocre performance, and confidence in the new energy power generation order market is no longer as firm as before. With market demand unlikely to see growth points next week and some enterprises in South China expected to have a one-day holiday during the Dragon Boat Festival, SMM forecasts that the operating rate of copper wire and cable enterprises will decline by 3.61 percentage points WoW to 75.06% next week (May 30-June 5).
