End-use demand peak season arrives, September copper foil operating rate rises [SMM Analysis]

According to an SMM survey, the operating rate of copper foil enterprises in September 2024 was 74.63%, up 5.90 percentage points MoM, down 8.01 percentage points YoY. Large enterprises had an operating rate of 79.69%, medium-sized enterprises 57.26%, and small enterprises 65.70%. In specific sectors, the operating rate for electronic circuit copper foil was 74.96% (up 6.09 MoM, down 7.34 YoY), and for lithium battery copper foil, it was 74.03% (up 5.55 MoM, down 9.66 YoY). The overall operating rate in the copper foil industry is expected to slightly decline to 74.09% in October. (Survey covers 35 enterprises, 58 production sites, total capacity: 1.5156 million mt)

September copper foil enterprises operating rate 74.63%

In September, the overall operating rate of domestic copper foil enterprises significantly rose to the highest level of the year. Before the National Day holiday, downstream enterprises stocked up, and rising copper prices stimulated downstream purchasing demand. Specifically, the operating rates of both lithium battery copper foil and electronic circuit copper foil enterprises increased. For lithium battery copper foil, the "September-October peak season" brought strong end-use demand. In the power battery sector, car production and sales steadily increased; in the energy storage sector, the iteration of new battery cell specifications progressed smoothly, boosting demand for anode materials; in the consumer and digital products sector, enterprises began stocking up for year-end promotions, with orders steadily rising. For electronic circuit copper foil, end-use consumption returned to peak season after the July-August off-season, with overall orders warming up, especially for high-end server-related orders.

September copper foil industry raw material and finished product inventories both increased

In September, the finished product inventory/output ratio in the copper foil industry decreased by 0.64 percentage points MoM to 18.86%. Finished product inventories accumulated due to the National Day holiday, but production increased more significantly. The raw material inventory/output ratio decreased by 0.83 percentage points MoM to 17.71%, but raw material inventories rose due to increased production schedules.

October copper foil industry operating rate forecast to slightly decline to 74.09%

SMM expects the overall operating rate of copper foil enterprises in October 2024 to be 74.09%, down 0.54 percentage points MoM, down 6.64 percentage points YoY. The operating rate for lithium battery copper foil is expected to be 74.53% (down 0.43 MoM, down 2.93 YoY), and for electronic circuit copper foil, it is expected to be 73.28% (down 0.75 MoM, down 13.77 YoY). As the year-end approaches and overseas holidays arrive, there is still stocking demand in the end-use market, with new orders expected to grow steadily. However, due to some downstream enterprises halting production during the National Day holiday, copper foil finished product inventories increased. Additionally, current TC/RC remains relatively low, leading some enterprises to slow down production schedules, hence the slight expected decline in the October copper foil operating rate.