Lisbon, Portugal — According to preliminary International Copper Study Group (ICSG) data, the refined copper market balance for January 2015 showed an apparent production surplus of 59,000 metric tonnes (t). When making seasonal adjustments for world refined production and usage, January showed a production surplus of 53,000 t. This compares with a production deficit of 142,000 t (a seasonally adjusted deficit of 149,000 t) in January 2014.
In January 2015, world apparent usage is estimated to have declined by around 3.5 percent (70,000 t) compared with that in January 2014. Chinese apparent demand declined by 3.8 percent (35,000 t) based on a 27 percent decrease in net imports of refined copper from the high net import level in January 2014 and consequent higher apparent usage. Excluding China, world usage declined by around 3.5 percent. On a regional basis, usage is estimated to have declined by 1.3 percent in Asia (when excluding China, Asia usage increased by 5 percent), by 13 percent in Europe and by 80 percent in Oceania. Usage increased by 6.5 percent in Africa and remained essentially unchanged in the Americas.
World mine production is estimated to have increased by around 6 percent (90,000 t) in January 2015 compared with production in January 2014. Concentrate production increased by 5.8 percent while solvent extraction-electrowinning (SX-EW) increased by 5.7 percent. The increase in world mine production was mainly due to a recovery in production levels in Indonesia and in Chile while the latter also benefited from new production at mines that started last year. Peruvian production remained unchanged while production in the United States declined by 5 percent. On a regional basis, production in January rose by 8 percent in Africa, 7 percent in the Americas, 8 percent in Asia, but declined by 1 percent in Europe and 6 percent in Oceania. The average world mine capacity utilization rate for January 2015 increased to 85.5 percent from 84.5 percent in January 2014.
World refined production is estimated to have increased by around 7.5 percent (130,000t) in January 2015 compared with refined production in the same month of 2014: primary production was up by 5.5 percent and secondary production (from scrap) was up by 16 percent. The main contributor to growth was China (+15 percent), followed by the Philippines, South Korea and the DRC where aggregated production increased by 28 percent (30,000 t). Output in Chile, the second leading refined copper producer, declined by 2 percent and in the United States production declined by 13 percent. The average world refinery capacity utilization rate for January 2015 increased to 81 percent from 78 percent in January 2014.
Based on the average of stock estimates provided by independent consultants, Chinese bonded stocks declined by around 5,000 t in January 2015 from the yearend 2014 level. Stocks increased by around 50,000 t in the same month of 2014. In January 2015, the refined copper balance adjusted for Chinese bonded stock changes indicates a surplus of around 56,000 t compared to a deficit of around 90,000 t in January 2014.
The average LME cash price for March was US$5,925.84 per tonne, up from the February average of US$5,702.08 per tonne. The 2015 high and low copper prices through the end of March were US$6,309.00 (on 2nd Jan) and US$5,390.50 per tonne (on 29th Jan), respectively, and the year-to-date average was US$5,818.13 per tonne (15 percent below 2014 annual average). As of the end of March, copper stocks held at the major metal exchanges (LME, COMEX, SHFE) totalled 599,994 t, an increase of 293,557 t (96 percent) from stocks held at the end of December 2014. Compared with the February levels, stocks were up the three Exchanges.
The April 2015 Copper Bulletin is available for sale upon request. Please visit the ICSG website icsg.org for further copper market related information.
Source: International Copper Study Group (ICSG)