Chinese aluminium wire and cable operating rates drop 6 percentage points M-o-M for CNY holiday

Shanghai Metals Market survey found the average operating rate in the aluminium wire and cable sector dropped 5.9 percentage points month-on-month and 0.6 percentage point year-on-year to 34.4 per cent in January 2023.

The average operating rate of large producers lost 9.2 percentage points M-o-M to 38.5 per cent, and that of mid-sized producers fell 4.3 percentage points to 29.3 per cent, while small producers remained stable.

The operating rates decline of wire and cable producers in January could be attributed to the production halt for the Chines New Year Holiday. But some producers reported having continued operation in advance for deliveries in February, resulting in in-plant inventory growth with falling orders from the power grid sector.

In January, the operating rates of wire and cable producers in Jiangsu and Zhejiang were relatively high, while that in Heilongjiang, Jilin, and Liaoning reduced amid poor orders. In December, China exported 13,700 tonnes of aluminium wire and cable to meet overseas demand, up 17.8 per cent month-on-month and 31.2 per cent year-on-year. In 2022, China’s aluminium wire and cable exports grew 24 per cent to 178,000 tonnes.

SMM has updated that domestic aluminium wire and cable companies resumed production in February. But due to slow order pick-up, SMM expects the average operating rate of wire and cable producers to decline in February.