High Copper Prices Dampen Purchases, Brass Billet Operating Rates Edge Down [SMM Brass Billet Market Weekly Review]

       According to SMM statistics, the operating rate for brass billet enterprises this week was 49.77%, down 0.87 percentage points WoW, with the pullback exceeding market expectations. Suppressed by copper prices continuing to fluctuate upward, new orders in the market were generally weak, with only a small amount of procurement triggered when copper prices briefly pulled back on Wednesday. Inventory side, raw material inventory remained at 4.01 days, while finished product inventories rose to 5.57 days, as the current sales progress lagged behind production.

       Downstream industry performance: orders in traditional sectors such as architectural hardware, sanitary ware, and valves were mediocre, with enterprises purchasing mainly for rigid demand and showing high price sensitivity; the home appliance and refrigeration components industries, supported by seasonal production schedules, saw relatively stable demand, but also mostly adopted cautious stockpiling strategies in the high copper price environment; most downstream enterprises reported that current high copper prices significantly suppressed purchase willingness, with a prevalent choice to wait-and-see and control raw material inventory levels.

       Looking ahead to next week, although persistently high copper prices continue to suppress short-term demand, as end-user customers' expectations for rising copper prices strengthen and acceptance gradually improves, coupled with year-end rush to meet deadlines and annual volume push plans in some downstream industries, a batch of restocking demand is expected to be released. SMM forecasts the operating rate for brass billet enterprises will rebound 0.48 percentage points WoW to 50.25% next week.