High Costs and Divergent Demand, Brass Billet Operating Rate Weakly Rises Slightly [SMM Brass Billet Market Weekly Review]

        According to SMM, the operating rate of the brass billet industry only increased slightly by 0.26 percentage points to 50.03% this week, weaker than market expectations. The industry overall showed a "weak recovery, high pressure" trend, mainly characterized by structural divergence in demand and dual pressure from costs and inventory. Although orders in areas such as refrigeration saw a seasonal recovery in Q4, the main demand from construction hardware and sanitary ware remained weak, with overall new orders limited. Meanwhile, persistently high copper prices significantly suppressed downstream purchase willingness, and enterprises generally faced the dilemma of "sluggish sales and finished product inventory buildup." Sample enterprises' finished product inventories rose to 5.59 days, higher than raw material inventory levels, further squeezing profit margins.

       Looking ahead to next week, the operating rate is expected to increase slightly by 0.51 percentage points to 50.54%, with the industry continuing a mild recovery trend. Seasonal demand will still provide some support to the operating rate, but long-term driving forces remain insufficient. High copper prices and weak core demand will continue to constrain downstream absorption capacity, and the industry as a whole will remain in a "weak recovery" channel, unlikely to show significant strengthening.