Off-Season Weakness Continued, Operating Rates of Brass Billet Producers Declined Further [SMM Brass Billet Market Weekly Review]

       This week (5.22-5.28), the brass billet industry remained in the doldrums, with an operating rate of 52.01%, down 0.13 percentage points WoW.Supply side, recycled brass raw materials were in tight supply and high in price, enterprises had insufficient raw material inventories, and production was constrained. Meanwhile, copper prices fluctuated at high levels, creating strong cost uncertainty, which suppressed enterprises' willingness to produce and stockpile, keeping overall industry operating rates low. Demand side, the off-season effect was evident, with end-use demand from home appliances, sanitary ware, hardware and other sectors remaining weak, and new orders were insufficient. Downstream wait-and-see sentiment was strong, with purchases mainly driven by just-in-time procurement. The pace of taking orders and cargo pick-up slowed down, finished product inventories across the industry stayed at a medium-to-high level, and market transactions were sluggish. Looking ahead to next week (5.29-6.4), the weak off-season pattern is unlikely to change, with tight raw material supply, high costs, and weak demand showing no signs of improvement for now.SMM expects the industry operating rate to decline 0.19 percentage points WoW to 51.82%, with operating rates unlikely to recover in the short term.