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Copper market forecast 2013-2014.

The International Copper Study Group (ICSG) met in Lisbon, Portugal, recently to discuss key issues affecting the global copper market. Based on those discussions, the ICSG developed projections for 2013, which indicate world production of refined copper is expected to exceed demand for refined copper by about 390,000 metric tons (mt). For 2014, although a recovery in usage is anticipated, a higher surplus is expected with increased output from new and existing mines.

In developing its projections, ICSG recognized that global market balances could vary from those projected owing to numerous factors including a world economic slowdown, European Union sovereign debt issues, political transitions in the Middle East and North Africa, and production shortfalls due to labor unrest, utility and capital shortages, and technical factors.

After three years of relatively stagnant production, mine production in 2013 is expected to increase by 6.5% from that in 2012. Strong growth is expected to continue in 2014 and 2015 as mine projects that were deferred or delayed during the financial crisis are expected to start coming on stream. Expansions and project startups during 2013 and 2014 are expected to increase world mine production to around 18.6 million mt in 2014 from 16.7 million mt in 2012. Most of the new production is expected to be copper in concentrate, with only limited electro-winning expansion.

In 2013, world refined copper production is expected to increase by 3.9% compared to 2012, as constrained production from maintenance and temporary operational shutdowns in some regions is overshadowed by expanded output in other regions. In 2014, refined copper production is expected to grow by around 5.5% to 22.1 million mt with the restoration of production at existing plants and new and expanded capacity at electrolytic plants in China, and to a lesser extent SX-EW plants in Africa. Primary refined copper production is expected to grow by about 7% and secondary production by 2%.

ICSG expects world apparent refined demand in 2013 to remain unchanged from that in 2012 (20.5 million mt). Although real demand for copper in China is expected to increase by about 6% in 2013, apparent demand in China (that is uncorrected for unreported stock changes) is expected to decrease in 2013 as a result of much lower refined imports. Usage in the rest of the world is expected to increase by around 1%. With better prospects for the world economy in 2014, world usage is expected to grow by around 4.5%. If China is excluded, growth is expected to be 2.5%.
Forecast to 2014 ('000 mt)

                         Mine Production

                      2012     2013     2014

Africa                1449     1820     2123
North America         2274     2339     2641
Latin America         7109     7426     7762
Asean                  645      743      896
Asia ex Asean/CIS     1944     2078    23333
Asia-CIS               546      560      574
EU-27                  826      839      854
Europe (others)        865      876      916
Oceania               1040     1140     1125
Total                16697    17822    19223
World Adjusted       16697    17775    18579
% Change                        6.5      4.5

                        Refined Production

                      2012     2013     2014

Africa                1057     1292     1475
North America         1647     1635     1751
Latin America         3420     3451     3612
Asean                  411      514      564
Asia ex Asean/CIS     8882     9310     9929
Asia-CIS               439      461      470
EU-27                 2742     2686     2781
Europe (others)       1071     1071     1112
Oceania                460      501      505
Total                20129    20922    22198
World Adjusted       20129    20912    22061
% Change                        3.9      5.5

                          Refined Usage

                      2012     2013     2014

Africa                 251      250      261
North America         2219     2279     2331
Latin America          618      633      659
Asean                  799      826      856
Asia ex Asean/CIS    12251    12103    12798
Asia-CIS               100      101      102
EU-27                 3054     3001     3034
Europe (others)       1133     1201     1255
Oceania                112      115      115
Total                20550    20525    21429
World Adjusted       20550    20525    21429
% Change                       -0.1      4.4
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Title Annotation:MARKETS
Publication:E&MJ - Engineering & Mining Journal
Geographic Code:4EUPR
Date:Oct 1, 2013
Words:613
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