- Elevated copper prices limit aggressive restocking activity
- Tight supply of auxiliary raw materials affects copper demand
Japan Metal Daily: The Tokyo Copper Products Commercial Association, chaired by Atsushi Murata, President of Murata Yohaku Shoten, held its regular press conference in Tokyo on the evening of 21 April to review the business environment surrounding copper product distribution.
While spot trading activity was gaining momentum due to high copper prices, sentiment has turned cautious amid rising uncertainty. Although the impact of the deteriorating situation in the Middle East remains limited for now, shortages of crude oil-derived materials could lead to a decline in shipments across a wide range of sectors, including housing, automobiles, and air conditioners.
Strip segment remains subdued
In the secondary strip market, cargo movement remained weak at low levels. While some early signs of demand recovery have emerged, current business conditions remain challenging. Market participants stated that amid worsening Middle East conditions, any further disruption in the procurement of necessary auxiliary materials could affect fresh inquiries from next month onward.
Wire rod demand softens
In the wire rod segment, buying interest for brass rods used in gas appliances and faucet fittings remained limited amid weak new housing demand. Additionally, demand for replacement and renovation-related applications, which had remained firm until last month, also slowed recently. Valve demand was largely steady, while automotive-related orders varied by vehicle model, though the broader trend remained soft.
Eiichi Nishiyama, President of Nishiyama Shoten, said distribution inventories were in slight surplus, while elevated copper prices continued to limit aggressive restocking activity, resulting in trading being driven mainly by routine transactions.
Tube segment slows after firm run
The tube segment, which had remained firm until the previous month, softened in April. Demand from refrigerated and cold-storage warehouse projects reportedly slowed from mid-April. At the same time, concerns over the procurement of insulation materials used in coated copper pipes for air-conditioning applications led to selective spot buying in the market. Two price hikes announced by major manufacturers in February and April had already tightened availability, with the worsening Middle East situation further aggravating supply shortages.
Koichi Higuchi, committee member and President of Higuchi Shoten, noted that shortages of resin and insulation materials may adversely impact air-conditioning construction demand going forward.
Supply shifts emerge
Following plans by major manufacturers to discontinue production of phosphorus bronze and nickel silver products in a few years, distributors and end-users have become more active in securing alternative suppliers. In addition, delivery lead times from manufacturers have reportedly extended amid improving semiconductor-related demand.
Note: This article has been written in accordance with a content exchange agreement between BigMint and Japan Metal Daily.
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