Enamelled Wire: Operating Rate in September Falls Short of Expectations, October Expected to See a "Sluggish Peak Season"

According to SMM, the comprehensive operating rate of the enamelled wire industry in September was 68.12%, up 1.56 percentage points MoM and up 4.15 percentage points YoY. Among them, the operating rate of large enterprises was 66.11%, that of medium-sized enterprises was 72.15%, and that of small enterprises was 70.29%.

The operating rate of the enamelled wire industry in September rebounded by only 1.56 percentage points, falling short of market expectations. On one hand, the industry remained in the off-season cycle, compounded by persistently high copper prices suppressing demand, resulting in weak procurement momentum in downstream markets and no significant improvement in overall demand. On the other hand, a sharp rise in copper prices before the National Day holiday directly impacted downstream enterprises' willingness to stockpile, leading to a significant decline in pre-holiday stockpiling demand. As a result, the order volume for enamelled wire enterprises at month-end failed to meet expectations. Under these dual pressures, the recovery of the industry's operating rate in September was constrained, resulting in overall weak performance.

In September, both the raw material and finished product inventory/output ratios of enamelled wire enterprises declined MoM: the raw material inventory ratio was 12.22%, down 0.19 percentage points MoM, while the finished product inventory ratio was 39.08%, down 0.31 percentage points MoM. To mitigate the risk of inventory devaluation caused by copper price fluctuations and address the still incomplete recovery in demand, enterprises proactively tightened their inventory strategies by optimizing raw material procurement pace and accelerating finished product destocking to reduce inventory holding costs and potential risks. However, overall, the finished product inventory levels of enamelled wire enterprises remain relatively high.

SMM expects the comprehensive operating rate of the enamelled wire industry in October to pull back to 67.66%, down 0.46 percentage points MoM. Although it is up 2.44 percentage points YoY, the overall operating trend remains sluggish. Some enamelled wire enterprises took holidays or implemented production cuts during the National Day holiday, directly dragging down the industry's overall operating rate. Demand side, current demand for enamelled wire from power transformers and new energy-related end-users remains relatively stable, and there are expectations of a recovery in end-user home appliance demand. However, high copper prices significantly suppress orders, and enterprises remain cautious about expectations for order growth. Considering these factors, the enamelled wire industry is expected to experience a "peak season without peak performance" in October.