China Brass Billet Industry Struggles with Weak Demand Amid Weather Disruptions
The brass billet industry in China continues to struggle with weak end-use demand recovery during its traditional off-season. Weather disruptions, particularly typhoons, have further weighed on production, with operating rates pulling back from last week and year-over-year.
Secondary brass supply remains tight due to limited growth in domestic scrap circulation and import supply, keeping raw material prices high and squeezing processing margins for producers. Despite periodic copper price pullbacks, producers' willingness to restock remains weak, with most adopting a purchase-as-needed approach.
The demand side is also hampered by off-season effects, with downstream industries such as home appliances, sanitary ware, and hardware showing limited willingness to restock. Producers' shipment pace remains slow, and finished product inventory destocking is hindered, with inventories shifting from earlier destocking to slight accumulation.
Looking ahead to this week (Aug 28-Sep 3), the industry's off-season pattern has not yet reversed, and end-use demand is unlikely to show significant improvement. SMM expects the brass billet operating rate to edge down to 48.42% this week, down 0.58 percentage point YoY.