Orders on Hand Support Stable Operations, High Copper Prices Suppress New Orders for Wire and Cable Enterprises [SMM Wire and Cable Market Weekly Review]

      This week (November 28–December 4), the SMM copper wire and cable enterprise operating rate was 67.12%, up 0.22 percentage points WoW but down 28 percentage points YoY. The normal production schedule of previous orders on hand provided core support for the stable operating rate this week. However, copper prices continued to rise in the first week of December. After prices broke through the key level of 90,000 yuan/mt, downstream market procurement sentiment was noticeably suppressed. Most wire and cable enterprises saw weak performance in new order intake, resulting in a gap in overall order continuity. Only a few customers placed sporadic supplementary orders based on expectations of further copper price increases, which was insufficient to change the overall pattern of weak new orders. By sector, demand release remained subdued across application areas under the general pressure of high copper prices, failing to provide effective support. Inventory side, affected by cost pressure from high copper prices, enterprises generally adopted just-in-time procurement strategies. The raw material inventory/output ratio decreased by 3.83 percentage points WoW to 13,060 mt. Meanwhile, cargo pick-up speed slowed down, and the finished product inventory/output ratio increased by 0.78 percentage points WoW to 18,635 mt. Looking ahead to next week, copper prices already hit a new high in the first week of December, while the issue of weak new order continuity remains unresolved. Most wire and cable enterprises plan to proactively slow down their production schedules to control risks. Therefore, SMM expects the copper wire and cable enterprise operating rate to drop to 65.31% next week (December 5–December 11).