"Plain" Wire & Cable

Cable Export Volume Grows

There has been substantial growth in the volume of Chinese exports of »plain cable« products, i.e. wire & cable without additions to transform it into assemblies or harnesses, though the average annual growth rate (18% over 1999 to 2004) has been slightly slower than that for assembly & harness products (21%).

Imports Are Mainly »Plain« Cable

A high proportion of the total volume of Chinese cable imports is plain cable.  Of the total cable import volume of 355,000 t in 2004, 289,000 t (81%) was plain cable.  Despite the higher added average value of assemblies and harnesses, plain cable also accounts for the majority (72%) of the value of total wire & cable imports.

Strong Growth in Coax Exports

Over recent years Chinese exports of coaxial cable have grown rapidly, both in terms of volume and value.  The export volume in code HS 8544.20 has grown from 26,000 t in 1999 to 149,000 t in 2004.  The value of exports has increased from $52m to $306m over this period, but there has not been a major shift in the average value in this product category.  As there is a significant element of labour cost in coaxial cable manufacture (e.g. for changes of braider bobbins), Chinese producers have a potential cost advantage.

The average value of these coaxial cable exports is low ($2,100/t). Chinese exports of coaxial cable are mainly standard, low specification products used in high volume (e.g. TV aerial downleads).

Main Markets for Coax Exports are North America and Europe

The main destinations for China’s exports of coaxial cables are North America ($71m under HS 8544.20 in 2004) and Europe ($54m).  The next two largest regions for exports are both within Asia, the Indian subcontinent ($37m) and South East Asia ($35m), followed by Central & Eastern Europe.  It is interesting that China can successfully export substantial amounts of coaxial cable not only to developed economies, but also to countries whose own labour costs are low.

Value of Coax Imports Goes Up

The pattern for imports of coaxial cable is very different to the trend in exports. The import volume for code HS 8544.20 is small, and has dropped from 6,000 t in 1999 to only 4,000 t in 2004, after peaking at 7,000 t in 2001.  The total value of coaxial cable imports has shown fluctuations from year to year, e.g. low in 2003 but relatively high in 2004.

There has, however, been a clear trend in the average value of coaxial cable imports: this has more than doubled from $6,500/t in 1999 to $13,500/t in 2004.  Once again, the general rule is that only higher added value products are imported, with less complex types being produced in China.

LV Energy Cable Import Volumes Fall But Average Value Increases

Imports in the category HS 8544.59, which consist mainly of LV energy cable rated at mains voltage, were 69,000 t in 2004, 19% of total import volume.  Imports in this category show a decreasing trend over the period 1999 to 2004, though the rate of decline has been relatively slow.  The average value of imports in this category has increased substantially from $2,600/t in 1999 to $4,800/t in 2004.  There are very many producers of building wire and other standard LV energy cables in China, so any imports should be cables to specifications that are not so readily available from local producers.

No Clear Growth Pattern in LV Energy Cable Exports

Chinese exports of LV energy cables have not shown any clear increasing trend.  Though export volumes from China under code HS 8544.59 were higher in 2004 (122,000 t) than in any of the previous four years, they actually dropped from 1999 to 2001 before picking up in 2002.  The average value of exports in this category has not changed very much between 1999 and 2004, except for the increase in 2004 when material prices moved higher.  Though some Chinese producers of LV energy cables can meet foreign standards (e.g. BS specifications for building wire used in the Hong Kong market) they have chosen not to grow export business very strongly.  Clearly, it is easier for Chinese producers to be competitive in cable assemblies using LV energy cables, where there is a significant potential gain through low labour costs, than in plain cable, where costs of shipping products from China would be likely to outweigh any manufacturing cost advantage.

Power Cable Imports Are Small

Power cable is not a major element of Chinese wire & cable imports.  Category HS 8544.60 (cables rated above 1 kV) accounted for only 4% of total wire & cable import volume in 2004.  The average value of power cable imports has grown from $4,100/t in 1999 to $6,400/t in 2004.  Even though the latter was boosted by higher material prices, the trend indicates that there has been some shift away from imports of cables that could be made locally.  The strong growth in the production capability of Chinese power cable-makers in the last few years means that all LV and MV and most HV cables can be made in China, with a need to import power cables only for the highest voltages or for exceptional specifications.

Power Cable Exports Are Growing?

The volume of Chinese power cable exports in 2004 (code HS 8544.60: 23,000 t) was higher than in any of the previous five years.  Though it is not clear from the trade data that this is part of a growth trend which can be expected to continue, some China-based power cable manufacturers are addressing export markets more keenly.

The Chinese market for power cables has been growing very strongly in recent years, so export growth has not been a priority for Chinese manufacturers.  However, strong competition in the home market, as a result of the huge capacity for production of MV and HV power cables that has been installed in China, must make export markets increasingly attractive for Chinese producers.

High Imports of Winding Wire

China is a substantial net importer of winding wire.  The volume of imports in categories HS 8544.11 / 8544.19 has been in the range 119,000 t to 142,000 t in each of the last six years.  In 2004 winding wire accounted for 38% of the total volume of Chinese wire & cable imports. 

The peak year for copper winding wire imports was 2000, though the volume in 2004 was nearly as high.  There has been strong growth in Chinese production of winding wire which has helped to limit the growth in imports that would otherwise have been needed to keep pace with high growth in Chinese consumption.  Many foreign manufacturers of winding wire have established production operations in China to follow the continuing global shift of electrical equipment manufacturing to China.  The increase in the average value of winding wire imports in 2004 reflects the increase in copper prices.

Main Source of Winding Wire Imports is N E Asia 

By far the largest region supplying winding wire to China is North East Asia (code HS 8544.11: $375m in 2004).  This total includes $134m from Taiwan, $137m from South Korea and $104m from Japan.

When OEMs from North East Asia establish operations in China, it is usual for existing winding wire suppliers to continue to supply until Chinese production is established.  There were also high imports of winding wire from South East Asia ($123m in 2004), of which the largest element was Malaysia ($77m).  Imports of $31m from Greater China were supplied via Hong Kong.  Chinese imports from North America and Western Europe are quite small ($21m and $19m, respectively).

Winding Wire Export Volume is Small but Growing

Though the volume of Chinese winding wire exports is relatively modest compared to imports, there has been a substantial increase, so the export volume reached 36,000 t in 2004.  This indicates that some of the increased Chinese production of winding wire has reached foreign markets.  The average value of winding wire exports ($3,200/t) is lower than the average value of imports ($4,300/t).  As higher added values in winding wire are usually linked to finer wires, this suggests that there is a product mix in exports favouring heavier wire gauges than in imports.

Imports of Auto Cables and OEM Cables Have Grown Strongly

The product code HS 8544.49 (cables rated below 80 V) includes both copper communication cables and LV energy cables.  This category is a major element of cable imports (56,000 t in 2004), and the volume of imports in this category has been increasing strongly.