For the Quarter Ending September 2023


North America:

In the third quarter, the US market for Copper Cladded Aluminum Wire experienced significant shifts. Initially, prices surged in response to an interest rate hike by the US Federal Reserve Board aimed at mitigating year-end inflation. This resulted in heightened demand within the renewable energy sector, particularly in the photovoltaic system industry throughout the USA. Key player Alcoa facilitated energy transition in Brazilian mills and resumed mining in Western Australia, thereby bolstering the domestic market. The electric vehicle sales of Tesla contributed to an upswing in Aluminum consumption in the automotive sector. However, persistent supply constraints for European Copper Cladded Aluminum Wire were observed due to diminished local mine production and export limitations from Indonesian suppliers. Prices stabilized in August, with the automotive sector maintaining stability, but uncertainties in the market, coupled with elevated inventory levels and rising interest rates, prompted cautious buyer behavior. Chinese producers' competition impacted automotive demand, while the renewable energy sector continued to show promise for Copper Cladded Aluminum Wire demand. There were concerns about potential adverse weather conditions impacting production costs in the near future.

APAC:

In Q3 2023, the South Korean market for Copper Cladded Aluminum Wire witnessed substantial price fluctuations characterized by fluctuations. July saw a surge in prices attributed to reduced manufacturer offers and weakened purchasing, influenced partly by high PRN packaging material prices and low aluminum recycling rates affecting aluminum durability. This led to predictions of decreased domestic demand and an increase in overseas recycling. Subsequently, domestic prices initially declined, mirroring India's production decrease due to weak demand. Global economic uncertainty and high import tariffs on raw Aluminum further pressured prices, resulting in cautious purchasing. Rising US interest rates negatively affected export demand, particularly in automotive manufacturing. In the mid-quarter, South Korean prices rebounded due to steady demand from the power and distribution sectors. Despite the recovery, concerns lingered regarding the US debt ceiling, slow domestic consumption, limited policy stimulus, and a gloomy global economic outlook. Stable supply levels increased local inventory, while bauxite imports from Guinea supported sustainable mining. Demand was weak in the construction sector but grew in the battery foil and electrical/electronic sectors. Short-term expectations indicated a positive trend in aluminum prices with a focus on downstream consumption intensity. The market demonstrated resilience amid ongoing challenges.

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Europe:

During the third quarter, the German market for Copper Cladded Aluminum Wire exhibited stability. Initially, prices surged due to improved economic conditions and reduced local inventories. Indonesian export restrictions tightened supply, raising spot market prices. A contract with the Indian rail company Alston boosted demand, as parts were to be manufactured in France, leading to higher export quotas from Germany. The European market is considering lifting the ban on Russian Aluminum imports, thanks to stabilization in supply and demand, supported by Russia's largest Aluminum producer, Russell. Alcoa's mining permit for its Aluminum Wire (Copper Cladded) mine in Western Australia and government recognition of Aluminum's importance further supported the market. Domestic supply remained tight due to the Indonesian mining ban and reduced German factory activity. The electric vehicle sector's recovery and a 0.25% rate hike stabilized inflation, fostering demand. In August, prices remained steady due to ample Bauxite supply and limited local orders. Downstream industries, including shipbuilding, clean energy, and automotive, showed promise, with companies like Volvo and Tesla expanding production across Europe. Despite economic uncertainties and cautious buyers, the Copper Cladded Aluminum Wire market is expected to witness increased demand in the upcoming months as production rates rise and economic conditions stabilize.


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