Operating Rates Slightly Increased This Week, Expected to Pull Back Next Week Due to Policies and Off-Season [SMM Brass Billet Weekly Review]

       According to SMM data, the operating rates of brass billet producers recorded 49.83% this week, up 0.06 percentage points MoM. The overall orders remained stable without significant fluctuations. Inventory side, SMM sample days of raw material inventories decreased by 0.05 days MoM to 3.56 days, at a low reserve level, and the days of finished product inventories dropped by 0.07 days MoM to 6.04 days.

       Looking ahead to next week, influenced by the tax rebate clearance policy in the secondary copper industry, some small brass billet factories in Jiangxi have suspended production to observe further developments, with local copper billet prices maintaining a firm stance. If the policy is officially implemented from September, the cost advantages of producers in Jiangxi will disappear, and it is expected that part of the orders will flow back to the Zhejiang market. In addition, the market is still in the traditional off-season, and enterprises generally believe that demand will gradually recover by mid-September. Overall, SMM expects the operating rates of brass billet producers to decline by 0.26 percentage points MoM to 49.58% next week.