SMM

      This week (August 8-14), the operating rate of SMM copper wire and cable enterprises was 69.3%, down 0.59 percentage points MoM and 24.36 percentage points YoY, but 0.38 percentage points higher than expected. Copper prices stabilized at highs, significantly suppressing downstream purchase willingness and failing to boost demand. Coupled with weak end-user orders, downstream demand showed no substantial improvement, collectively leading to the decline in operating rates. By sector, current market demand relies on a single support structure, with most enterprises only able to maintain basic operations through orders from State Grid. No significant growth highlights were observed across sub-sectors, resulting in overall mediocre performance. Inventory-wise, affected by high copper prices, most firms adhered to just-in-time procurement until Thursday when prices retreated, prompting some to seize the timing for spot purchases. Raw material inventories of sampled enterprises increased 2.44% WoW to 15,130 mt. To alleviate finished product inventory pressure, some companies actively launched sales promotions to accelerate destocking, reducing finished product inventories by 1.61% WoW to 18,890 mt. Looking ahead, with no new demand growth drivers emerging and weak demand persisting across sectors, industry recovery lacks momentum in the short term. SMM expects the copper wire and cable operating rate to edge down to 67.6% next week (August 15-21).