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Metals & Mining

Thu 13 Mar 2008 15:43

China's copper consumption to hit 5 mln tons in 2008 - official

Hangzhou. March 12. INTERFAX-CHINA - China's refined copper apparent consumption will reach 5 million tons in 2008, edging up 4 percent from 4.8 million tons last year, a senior official from dual Hong Kong and Shanghai-listed Jiangxi Copper Co. Ltd., China's top copper smelter, told Interfax at the 2008 Copper and Copper Product Forum held in Hangzhou Tuesday.

"China is set to continue tightening its monetary policy in an attempt to curb an overheated economy and inflation, so we might see a slight slowdown in refined copper consumption growth this year," Su Li, vice president of Jiangxi Copper's trade department, said.

Su said that China's refined copper consumption will maintain stable growth in the long run due to growing demand from the power industry. China is currently pumping investment into its power grids, with the aim of increasing power generation capacity from 900 million kilowatts in 2010 to 1.6 billion kW in 2020.

Copper is used in a variety of industries in China, including the power grid, electronics, machinery manufacture, construction and transportation industries.

"Despite the likelihood that decreasing copper concentrate treatment and refining charges (TC/RCs) will force Chinese copper smelters to cut production this year, China's refined copper outputs will still reach around 4 million tons in 2008," Su said.

Based on Su's estimate, China's refined copper output in 2008 will rise 16.2 percent from 3.44 million tons in 2007.

Jiangxi Copper produced 553,600 tons refined copper in 2007, up 24.85 percent year-on-year.

An additional 600,000 tons of copper smelting capacity and 700,000 tons of refining capacity came online in 2007, and will hopefully reach full production capacity in 2008. This will increase China's copper smelting and refining capacity to 2.84 million tons and 4.3 million tons respectively in 2008, Su said.

Su also said that although copper concentrate supply shortfalls have become a stumbling block to the development of China's copper industry, high dependence on copper concentrate imports squeezes copper smelters' profits and accelerates industrial consolidation.

China is set to produce 950,000 tons of copper metal in concentrate form in 2008, up 10 percent from 2007, Su said.