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Copper sector will gain relative equilibrium

27 March 2016

Anyway, these are the forecasts do ICSG specialists. They view the prospects for the year 2016−2017. If now we are talking about a possible equilibrium, the previously assumed surplus of copper. The previous forecast pointed to an excess of metal in 2016 at 175,000 tonnes. At the same time we have not gone away doubts about the future of the global economy. As a result, there are delays and reduction projects, the reduction of production volumes of existing production facilities. The last point is especially true for companies with high costs. Of great importance is a noticeable decrease in the cost of metals. All these factors are increasingly reduce the likelihood of excess supply. According to the new forecast supply shortage will occur in 2016. It will amount to around 57 000 tonnes. In 2017, still possible oversupply of copper. To date, the estimated level of 20 000 tonnes.

Development of copper this year will remain roughly at the level of 2015. The volume is projected to reach 22 million. 943 thousand tons. In 2017, according to the expectations of professionals will grow by 2.1%. As a result, rate will reach the level of 23 million. 436 thousand tons. If you do not take into account the method of SX-EW, and increase production of primary copper. In 2016, growth will be 3%. Thus there will be a decline of secondary processing. It will be 1%. Production of copper in the mines by SX-EW will decrease by 8%. Release the red metal by the method of SX-EW it will be renewed in 2017. This year, copper consumption will remain at the level of 2015, reaching 23 million. Tons. In 2017, the consumption level will mark 23 million. 416 thousand tons. The indicator thus increase by 1.8%.

Representatives of the company Freeport-McMoRan Inc express their own assumptions. According to them, the balance between supply and demand is reached no earlier than 2017. red metal consumption will increase gradually. The annual increase until 2020 will be 2%. Since 2017 in the copper sector is expected shortage of metal. It occurs on the background of the lack of new projects. It is possible that in 2020 the global shortage of copper will be about 500 000 tonnes.

In the past few years, the cost of copper has decreased markedly. These results are seen against the backdrop of slowing economic growth in China. That China is the largest consumer of copper in the world.

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