Operating Rates At Copper Scrap Rod Plants Dropped Sharply

The operating rates of copper rod plants using copper scrap were 39.04% between May 20 and May 26, a drop of 14.07 percentage points from a week earlier, according to SMM survey of 15 plants with a capacity of 1.48 million mt/year).

On the supply side, copper prices continued to fall last week, and suppliers of copper scrap were reluctant to sell their goods. Therefore, the price difference between copper cathode and copper scrap continued to be below the advantage line, making it difficult for copper scrap rod factories to purchase.

On the consumption side, the terminal consumption is weak. As the price difference between copper cathode and copper scrap has been below the advantage line, substituting copper cathode rod for secondary copper rod weakened. The consumption has declined rapidly. It is worth noting that due to the difficulty in copper scrap purchases, secondary copper rod factories have reduced production. The marginal supply of copper scrap rods fell faster than the marginal consumption. Prices of copper rod produced with copper scrap remained above SHFE copper prices.

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