India-origin brass billet prices on a CFR China port basis declined week on week, primarily reflecting the fall in the LME Copper 3-month benchmark, while the percentage spread against LME copper widened slightly. LME Copper 3-month declined by around 2.25%, from $14,760/mt on September 22 to approximately $14,427.50/mt on September 29. Against this benchmark, India-origin brass billets for export to China were assessed at 62.5–63.5% of LME Copper 3-month this week, compared with 62–63% last week. The spread therefore widened by 0.5 percentage point at both the lower and upper ends, with the midpoint increasing from 62.5% to 63%.
Despite the wider percentage spread, the outright CFR China price for India-origin brass billets declined because of the lower LME copper benchmark. The resulting assessment range fell from approximately $9,151–9,299/mt last week to $9,017–9,161/mt this week. The average assessment declined to around $9,089/mt from $9,225/mt previously, down $136/mt, or around 1.5%, week on week.
LME Copper cash also declined from $14,797/mt on September 22 to around $14,450/mt on September 29. LME copper stocks fell by 2,900 tonnes, or around 1.14% week on week, from 254,250 tonnes on September 22 to 251,350 tonnes on September 29. The decline indicates some tightening in readily deliverable exchange stocks, although inventories remained at a relatively substantial level.
China domestic brass rod demand remained weak, providing an important demand-side reference for India-origin brass billet exporters to China. During September 25–October 1, the operating rate of SMM’s sampled Chinese domestic brass rod enterprises stood at 37.90%, down 11.93 percentage points month on month. The long Mid-Autumn Festival and National Day holiday led enterprises to arrange shutdowns, resulting in a marked contraction in production.
High copper prices also increased pressure on Chinese brass rod producers, while tightening availability of recycled brass raw materials resulted in slim processing profits. Chinese downstream players showed weak enthusiasm for pre-holiday restocking, with the restocking scale lower than during the same period last year. Finished-product destocking also proceeded slowly, pointing to subdued domestic consumption.
For India-origin brass billets offered for export to China, these domestic Chinese demand conditions limited buying interest from potential Chinese buyers ahead of the October 1–7 National Day holiday. Buyers remained cautious and showed limited willingness to build inventories, despite the lower outright billet prices. The wider billet percentage spread therefore should not be interpreted as a sign of stronger Chinese demand; rather, it indicates that the billet value component remained relatively resilient against the falling copper benchmark.
Looking ahead to October 2–8, workers at SMM’s sampled Chinese brass rod enterprises are generally expected to take four to five days of holiday, with the average holiday duration broadly unchanged from last year, increasing by only 0.08 days. SMM expects the operating rate of sampled Chinese brass rod enterprises to decline further to 34.51%, down another 3.39 percentage points month on month.
For India-origin brass billet exporters, the expected decline in Chinese domestic brass rod operating rates suggests that near-term Chinese buying interest is likely to remain subdued. With copper prices still at elevated levels, Chinese buyers are expected to remain cautious, while SMM expects no significant improvement in Chinese brass rod demand during October.
Overall, India-origin brass billet CFR China prices declined on the lower LME copper benchmark, while the pricing spread widened modestly. However, weak operating rates and subdued restocking in China’s domestic brass rod sector indicate limited near-term demand support for imported Indian billets. The combination of high copper prices, tight recycled brass raw-material availability and the extended holiday period is likely to keep Chinese buyers cautious into October.
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