Brass Billet Production Recovered After the Holiday, but Off-Season Dragged Down Subsequent Rebound Potential [SMM Brass Billet Market Weekly Review]

This week (5.8-5.14), the operating rate of the brass billet industry was 52.34%, up 7.67 percentage points WoW.The impact of the post-holiday period gradually faded, and industry production saw a slight recovery. However, affected by the arrival of the traditional consumption off-season, the recovery in operating rates was insufficient and unable to rebound to pre-holiday levels. Supply side, recycled brass raw materials supply remained tight, enterprise raw material inventories continued to decline, and production was subject to certain constraints. Meanwhile, copper prices swung wildly, cost uncertainty increased, end-user wait-and-see sentiment was strong, and the pace of taking orders and picking up goods slowed down, leading to a buildup of finished product inventories at enterprises.Looking ahead to next week (5.15-5.21), SMM expects the industry operating rate to decline 0.23 percentage points WoW to 52.11%. The industry has currently entered the traditional off-season. Coupled with copper prices fluctuating at highs and weak follow-through on end-user orders, the industry operating rate is unlikely to improve in the short term and is expected to remain at low levels.