China's copper cathode output in July was 925,900 mt, an increase of 8,000 mt or 0.9% month-on-month, and a growth of 10.2% year-on-year; The output increased 23,800 mt compared with the expected 902,100 mt. The output totalled 6.49 million mt from January to July, an increase of 639,300 mt or 10.94% year on year. Although there were seven smelters undergoing maintenance in July, the impact on many smelters was less than previously expected thanks to abundant supply of blister copper and anode plates. And benefited from a newly commissioned smelter in Shandong, the output in July exceed expectations. This can also be reflected in the rebound of RCs for blister copper. According to the latest statistics from SMM, as of July 28, the average RC of blister copper in the south was 1,000 yuan/mt, an increase of 200 yuan/mt from the beginning of July. The average operating rate at copper smelters stood at 86.49% in July, flat on the month. (SMM increased capacity of the survey samples by a combined 90,000 mt, adjusting the capacity of JCC Guoxing (Yantai) Copper and increasing the capacity of Baotou Huading. The current total capacity of the survey is 12.575 million mt/year).
According to SMM statistics, only one smelter has overhaul plan in August. The smelters that undertook maintenance will restart production and newly commissioned smelters will yield output. These, combined with the absence of raw material shortages, will increase total domestic output significantly in august. The output increase brought about by the production resumption of a smelter in Inner Mongolia will account for about 48%. Domestic copper cathode output in August is estimated at 986,100 mt, up 60,200 mt or 6.50% month on month and 15.1% year on year to hit a record high.
The cumulative output from January to August is expected to be 7.47 million mt, an increase of 11.47% or 768,900 mt year-on-year. According to SMM statistics, the number of smelters with maintenance plans in the fourth quarter will decrease significantly, with 6 in September, 3 in October, 1 in November, and none in December. Therefore, SMM expects that the output will decline slightly in September, but will remain at high levels in the following months.
