Copper market to move into surplus in ’14: ICSG
Global refined copper output will exceed demand by 405,000 tonnes in 2014 after four consecutive years of supply deficits, according to the International Copper Study Group (ICSG).
The ICSG forecast adjusted refined copper production of 22.4 million tonnes in 2014, up 6.5 percent from nearly 21 million tonnes in 2013, with output expected to grow to 23.3 million tonnes in 2015.
“Refined production will benefit from adequate availability of concentrate—and to a lesser extent from expanded SX-EW (solvent extraction-electrowinning) capacity in Africa, offsetting expected tightness in the scrap market,” the Lisbon, Portugal-based organization said. “For 2015, although growth in usage is anticipated to continue, another surplus could occur owing to an increase in refined output that exceeds the expected growth in usage.”
Global usage of refined copper is expected to total nearly 22 million tonnes in 2014, up 3.2 percent from 21.3 million tonnes in 2013. That figure is forecast to grow to 22.7 million tonnes in 2015.
“Apparent demand in China is expected to increase by about 5 percent in 2014, (while) usage in the rest of the world is expected to increase by about 2 percent. With better prospects for the world economy in 2015, world usage is expected to continue its growth, with world ex-China growth increasing to 2.5 percent and Chinese growth at about 5 percent,” the ICSG said.
Refined copper demand exceeded production by 282,000 tonnes in 2013, according to preliminary ICSG figures, primarily due to “constrained growth in refined production and growth in China’s apparent demand.”
“Although Chinese net imports were lower in 2013, refined production was significantly higher. Anecdotal evidence suggests that unreported inventories held in bonded warehouses in China declined during 2013.
Accounting for the unreported inventory decline, estimated to total about 260,000 tonnes, the ICSG calculated market deficit would increase to about 540,000 tonnes,” the ICSG said.
Publish date : Friday 11 April 2014 01:51
Story Code: 6439