Winter Park, Florida 22/08/2016 - The global refined copper industry recorded a production deficit of around 222,000 tonnes in January through May, which equates to a seasonally adjusted deficit of about 181,000, the International Copper Study Group (ICSG) said on Monday.
This compares with a production deficit of 39,000 tonnes tonnes or a seasonally adjusted surplus of about 10,000 tonnes for the same period of 2015, the trade group said.
In May alone, the market showed an apparent production deficit of around 65,000 tonnes mainly due to strong Chinese apparent refined copper demand, ICSG said.
World apparent refined usage in the first five months increased by around five percent or 510,000 tonnes mainly due to strong Chinese apparent demand, the report said.
"Chinese apparent demand increased by around 12 percent based on a 22 percent increase in net imports of refined copper from the lower net import level in early 2015 and consequently lower apparent demand. Excluding China, world usage remained essentially unchanged," ICSG said.
On a regional basis, usage is estimated to have increased by six percent in Europe and eight percent in Asia (when excluding China, Asia usage declined by 2.5 percent), while declining by 20 percent and four percent in Africa and in the Americas respectively and remaining essentially unchanged in Oceania.
Mine production rose by four percent or 345,000 tonnes in the first five months. Concentrate production increased by 5.5 percent while solvent extraction-electrowinning (SX-EW) remained essentially unchanged.
"The increase in world mine production was mainly due to a 52 percent rise in Peruvian output that is benefitting from new and expanded capacity brought on stream in the last two years. A recovery in production levels in Canada and the United States, expanded capacity in Mexico and a ramp-up in production in Mongolia also contributed to world growth," ICSG said.
But this was partially offset by a five percent decline in production in Chile and a 11 percent decline in DRC where output is constrained by temporary production cuts. On a regional basis, production rose by seven percent in the Americas and five percent in Asia but declined by four percent n Africa while remaining essentially unchanged in Europe and Oceania, the group added.
Refined production climbed by 3.5 percent or 330,000 tonnes through May. Primary production was up by three percent and secondary production was up by five percent.
The main contributor to growth was China (up seven percent), followed by the United States where production increased by 18 percent. Output in Chile and Japan, the second and third leading refined copper producers, increased by around 3.5 percent respectively. Refined production in the DRC and Zambia declined due to the impact of temporary production cuts.
China’s bonded stocks increased by around 140,000 tonnes during the period. The world refined copper balance adjusted for the change in Chinese bonded stocks indicates a production deficit of around 84,000 tonnes compared to a surplus of about 11,000 tonnes in the same period of 2015.