High Copper Prices Suppress Purchases, Brass Billet Operating Rates Struggle to Rebound After the Holiday [SMM Brass Billet Market Weekly Review]

This week (10.3-10.9), the brass billet industry overall performed weakly, with the enterprise operating rate recorded at 41.3%, down 7.18 percentage points from pre-holiday levels. The National Day holiday was the main factor, as many enterprises arranged for work stoppages and holidays, leading to a slowdown in the production pace. Inventory side, the raw material inventory of sample enterprises remained at 4.45 days, while the finished product inventory was 5.99 days. Affected by the rapid surge in copper prices, enterprises generally controlled stockpiling, leading to an overall contraction in inventory levels compared to the previous period.

From a market performance perspective, the brass billet industry is currently facing a situation of "high prices but thin volume." Before the holiday, copper prices broke through the high level of 83,000 yuan/mt, which significantly suppressed downstream purchase willingness, leaving enterprises with insufficient motivation for stockpiling. After the holiday, copper prices continued to rise sharply, further intensifying downstream wait-and-see sentiment. New orders were scarce, and many enterprises reported a clear characteristic of "price without market."

Looking ahead to next week, as the holiday disruption subsides, SMM expects the operating rate of the brass billet industry to rebound by 5.9 percentage points WoW to 47.2%. However, under the pressure of persistently high copper prices, the overall operating level is still expected to be difficult to recover to the pre-holiday state. The industry is likely to continue a flat operating trend, with limited rebound strength.