According to SMM, the operating rate of copper cathode rod enterprises was 62.64% in August, down 4.37 percentage points MoM, 2.11 percentage points below expectations, and down 5.73 percentage points YoY.Among them, the operating rate of large enterprises was 72.34%, medium-sized enterprises 47.12%, and small enterprises 59.92%.
The operating rate of copper cathode rod enterprises was 62.64% in August, down 4.37 percentage points MoM and down 5.73 percentage points YoY. (The operating rate in July last year was 62.64%).
Overall, copper prices shot up persistently in August, and high copper prices significantly suppressed downstream orders, with new orders falling notably. Some enterprises opted for maintenance shutdowns to avoid cost pressure, and the industry-wide operating level continued to pull back, with copper cathode rod output declining somewhat. By downstream sector, the two major consumption areas of wire and cable and enamelled wire were also under pressure, with weak demand and simultaneous contraction in operating rates and orders, showing an overall seasonal pullback in demand. The foreign trade market was relatively active in August, with orders improving notably from July, but overall exports remained low, providing limited support to operating rates.
In August, days of raw material inventories at copper cathode rod enterprises were 2.03 days, and days of finished product inventories were 3.98 days.
This month, copper prices kept shooting up amid a wide price spread between futures contracts, and enterprises only made just-in-time procurement without concentrated restocking. Days of raw material inventories fell 0.1 day MoM, with relatively stable fluctuations. On the finished product side, downstream demand for wire and cable and enamelled wire was weak, and insufficient orders led to low production enthusiasm. Cargo pick-up slowed notably, finished product inventories accumulated significantly, and days of inventories rose 0.2 day MoM.
The operating rate of copper cathode rod enterprises is expected to be 63.69% in September.
Looking ahead to September, the operating rate of copper cathode rod is expected to rise 1.05 percentage points MoM to 63.69%, down 6.61 percentage points YoY.Copper prices stay high, and downstream acceptance is slowly improving, but wait-and-see sentiment persists. Just-in-time procurement remains limited, and new orders are unlikely to recover significantly. Copper cathode rod enterprises are concerned about an "underperform in peak season" scenario in September. Combined with expectations of the Mid-Autumn Festival holiday at end-September, the operating rate is expected to rise only slightly.
