SMM

How has the enamelled wire market performed recently? Can the industry's peak season arrive as expected? SMM surveyed multiple enamelled wire companies, and the details are as follows:

Company A: The company produces both round and flat wires. Flat wire products have always been good, and recently round wire products have also been performing well. Orders for downstream home appliance products have indeed increased. Both production and sales in October were good, and November is expected to maintain this trend.

Company B: Produces both round and flat wires. Flat wire orders are better, especially in September and October, but started to decline in November. Round wire has not changed much overall, remaining mediocre. This year's overall performance is not as good as previous years.

Company C: Only produces round wires. October's performance was mediocre, with little change from September. Orders for downstream home appliances have increased, and the home appliance subsidy policy has provided some boost. However, the profit margin for enamelled wire is too low, and the proportion of customers in the home appliance sector will gradually decrease in the future.

Company D: Only produces round wires. The home appliance policy in Guangdong is quite strong, coupled with the air conditioning industry entering its peak season, so orders for home appliance enamelled wires are good. October's production increased by 10% MoM, and November is expected to maintain this trend.

Company E: Only produces round wires. October orders exceeded expectations, mainly due to the significant increase in orders from the home appliance sector. Current orders are quite sufficient, and November is expected to continue growing.

Company F: Mainly produces round wires. With many large downstream customers, orders are relatively stable. The distinction between peak and off-seasons is not obvious this year, and the increase in orders for November is expected to be limited.

Company G: Only produces flat wires. Orders have always been very stable, and capacity is already at full capacity. Orders for traditional power transformer flat wires have always been stable.

Company H: Mainly produces round wires, with flat wires accounting for 30%. Recent orders have been good, maintaining full production, especially for new energy-related orders. Round wire orders have not changed much and remain stable.

Company I: Only produces round wires. October orders were 20% below expectations, overall not ideal. November orders are also not optimistic, and the peak season is not felt this year.

Company J: Only produces round wires. Entering the production peak season in October, downstream orders increased, but overall are not at the same level as last year.

Company K: Only produces round wires. October orders from the automotive sector were moderate, but overall orders were average, especially for small transformers, where orders declined significantly due to the substitution by flat wires. November is also expected to be difficult to improve.

Company L: Only produces round wires. Orders began to decline in late October and are currently mediocre, with no signs of a peak season.

From the survey of companies, since September, home appliance subsidy policies have been implemented nationwide, coupled with "Double 11" promotions and the air conditioning industry entering its peak season, the demand for enamelled wire in the home appliance sector has increased significantly. In October, multiple enamelled wire companies in South China saw an increase in orders. The better-than-expected performance of the home appliance sector was the main factor driving the recovery of orders in the enamelled wire industry in October. Meanwhile, the demand from industrial motors, new energy, and power sectors remained stable, also positively impacting the enamelled wire industry orders. However, the current demand from the real estate sector for enamelled wire remains a drag that is difficult to change. Most companies do not have strong expectations for order growth in November, with some believing that the difference between off-season and peak season this year is not obvious, and "peak season not peak" or "small peak season" may become the norm. Data-wise, SMM expects the operating rate of the enamelled wire industry in November to be 66.76%, up 1.66 percentage points MoM, but down 5.95 percentage points YoY.