VANCOUVER (minignweekly.com) – The world’s refined copper balance for the first half of 2017 indicates a deficit of around 75 000 t, including revisions to data previously presented, the Lisbon-based International Copper Study Group (ICSG) revealed on Wednesday.
This is mainly owing to stagnant growth in the world's refined copper supply, the think tank said in its September copper bulletin.
However, the copper balance in the first half of the year, adjusted for changes in Chinese bonded stocks, indicates a deficit of around 5 000 t.
The ICSG found that world mine output had fallen by about 2% year-over-year, with concentrate production declining by around 1.7% and solvent extraction-electrowinning (SX-EW) declining by around 3.5%. The decline in world mine output was mainly owing to a 9% (245 000 t copper) decline in production in Chile, the world’s biggest copper-producing country, negatively affected by the strike at the Escondida mine and lower output from Codelco mines.
A decline in Canada and Mongolia concentrates output of 22% and 21%, respectively, mainly owing to lower grades in planned mining sequencing, also weighed on global production, while a 9% decline in Indonesian concentrate production, constrained by a temporary ban on concentrate exports that started in January and ended in April, also added to the deficit.
The ICSG also cited a 10% drop in US production on the back of lower ore grades, reduced mining rates and unfavourable weather conditions at the beginning of the year for the lower output.
However, these reductions in output were partially offset by a 9% and 7% rise in Mexican (concentrate and SX-EW) and Peruvian (concentrate) output, respectively, with both countries benefiting from new and expanded capacity that was not yet fully available in the same period of last year.
Globally, mine output improved in the second quarter over the prior period, but was still 1% below that of the same period of 2016.
World refined production is estimated to have remained essentially unchanged in the first half of 2017, with primary output (electrolytic and electrowinning) declining by 1.5% and secondary production (from scrap) increasing by 12%.
World apparent refined usage is estimated to have declined by around 2% in the first half of 2017, as China apparent usage, which currently accounts for almost 50% of the world refined usage, declined by 4%.
As of the end of August, copper stocks held at the major metal exchanges totalled 575 984 t, an increase of 36 911 t (7%) from stocks held at the end of December 2016.