Weak demand + high copper prices have caused the operating rate of brass billet producers to drop to 51.89% [SMM Weekly Review of Brass Billet Market]

       According to SMM data, the operating rates of brass billet producers fell to 51.89% this week, down 0.64 percentage point MoM. Given the continued weakness in downstream demand, enterprises have recently lowered copper billet prices in an attempt to gauge demand and reduce inventories. However, the price cuts have not significantly stimulated demand, and most enterprises are still facing inventory backlogs, which has subsequently reduced their enthusiasm for raw material procurement. In addition, copper prices have been fluctuating at highs, making enterprises hesitant to stockpile large quantities of raw materials. SMM samples show that days of raw material inventories increased by 0.13 day MoM to 4.83 days, while days of finished product inventories increased by 0.85 day MoM to 6.92 days. Looking ahead to next week, with the arrival of the second week of June, enterprises are generally adopting a wait-and-see attitude. If the tight raw material supply situation eases and copper prices pull back to a certain extent, the operating rates may rebound, but the extent will be limited. SMM expects the operating rates to increase by 0.42 percentage point MoM to 52.3% next week.