After having grown by 2.5% in 2018, global copper production is expected to remain essentially unchanged this year, but will grow by 1.9% in 2020, the International Copper Study Group (ICSG) said in its ‘Copper Market Forecast for 2019/20’, released on Monday.

ICSG met with global copper industry stakeholders on May 9 and 10 to discuss key issues affecting the global copper market.

Global mine production increased by 2.5% in 2018, mainly owing to constrained output in 2017 and to an unusually low rate of overall supply disruptions in 2018.

Besides the restart of the Katanga mine in the Democratic Republic of Congo (DRC), no major new copper mine capacity was brought on stream in 2018.

This year, additional output from the start-up of the major Cobre de Panama mine, in Panama, the expansion of Toquepala mine, in Peru, and the commissioning of a few other small to medium mines is expected to be balanced by a significant decline in Indonesian output – owing to the transition of Grasberg to an underground operation and Batu Hijau mine to Phase 7 – and regulatory and taxation issues, which will negatively impact output in Zambia.

For 2020, the ICSG said, additional supply from mines in ramp-up and expansions that started in 2019, together with a recovery in Indonesian output, will support growth of about 1.9%.

REFINED PRODUCTION

Refined production, meanwhile, is expected to increase by around 2.8% this year and by 1.2% in 2020.

In 2018, global refined copper production was constrained by an unusually high frequency of smelter disruptions and temporary shutdowns for technical upgrades and modernisations.

This year, expanded electrolytic capacity in China, the ramp-up of electrowinning output in the DRC and the recovery from 2018 operational issues and maintenance at smelters in Australia, Brazil, Indonesia and Poland, besides others, will largely offset lower anticipated production at some plants in China and Europe, owing to planned maintenance shutdowns, and lower output in Chile and Zambia, owing to operational issues at smelters.

A rise of 2.8% is expected for this year but, in 2020, planned electrolytic refined production is likely to be constrained by tightness in the availability of concentrates, resulting in a limited increase of 1.2% in world refined production.

After a small decline in 2018, world secondary production from scrap is expected to recover in 2019 and 2020. China will remain the biggest contributor to world refined production growth in both 2019 and 2020.

APPARENT REFINED USE

The ICSG expects world apparent refined copper use to increase by around 2% this year and by 1.5% in 2020.

The organisation stated that sustained growth in copper demand should continue because copper is essential to economic activity and even more so to modern technological society.

Infrastructure development in major countries such as China and India and the global trend towards cleaner energy will also continue to support copper demand.

China will remain the biggest contributor to global growth in copper use. Although underlying “real” demand growth in China is estimated by some analysts to be around 2.6% this year, Chinese apparent demand is predicted to rise by 2%.

The outlook for the European Union and Japan remains sluggish for 2019 and 2020, with demand in the US continuing to rise this year, but levelling off in 2020.

Global use, excluding China, is expected grow by around 1.7% this year and by a further 2% in 2020, mainly supported by increases in the Middle East, India and some other Asian countries.

World refined copper balance projections indicate a deficit of about 190 000 t and 250 000 t for 2019 and 2020 respectively.