Copper Wire and Cable Operating Rate Steady with an Increase, Pre-Holiday Operating Expectations Expected to Adjust Downward [SMM Wire and Cable Market Weekly Review]

      This week (January 23–29), the SMM operating rate for copper wire and cable enterprises was 59.46%, up 0.75 percentage points MoM. Specifically, production this week mainly relied on previously retained orders and progressed in an orderly manner, with the production pace largely consistent with the previous period and no wild swings observed, indicating strong overall production stability in the industry. By sector, orders from State Grid continued to be released, serving as the core driver supporting the operating rate of enterprises; meanwhile, scattered small orders in the market also provided auxiliary support for production, but engineering-side orders remained weak, showing no signs of improvement. On the inventory side, copper prices fluctuated significantly during the week, prompting enterprises to adopt a more cautious approach to raw material procurement, strictly controlling the scale of raw material stockpiling and focusing on just-in-time procurement. Only some enterprises, driven by concerns over rising prices, procured raw materials in advance for stockpiling, leading to a 1.55% increase in the raw material inventory ratio, recorded at 13,115 mt. Finished product inventories remained relatively stable, as enterprises mostly followed orders to arrange production schedules in an orderly manner, maintaining a balance between inbound and outbound flows, resulting in a slight destocking trend overall, down 0.74 percentage points MoM, recorded at 18,090 mt. Looking ahead to next week, copper prices hit another record high towards the end of the week, dampening downstream enthusiasm for cargo pick-up. Coupled with the approaching Chinese New Year holiday and weakening market demand, some enterprises have begun planning early holiday arrangements. Therefore, SMM expects the operating rate for copper wire and cable to decline by 2.82 percentage points MoM to 56.64% next week (January 30–February 5).