SHANGHAI, May 13: China’s refined copper consumption is expect to rise 7 percent in 2013, although faster output growth is putting the sector at risk of overcapacity in the future, a senior official from China’s Nonferrous Metals Industry Association said.
Total refined copper consumption from the world’s top importer is expected to reach 830 million tonnes this year, while output is expected to climb 8 percent to reach 630 million tonnes, the China Securities Journal on Monday quoted Shao Fu, deputy director of the association as saying.
Copper consumption growth would accelerate slightly this year with increased investment by the State Grid Corp as well as strong demand from electrical appliances sector, Shao said. The association did not give comparative growth figures.
Investment by the State Grid is expected to rise 4 percent from a year ago while analysts have forecast demand for home appliances to increase by 2 percent this year, the paper said.
Despite the rising consumption, as Chinese smelters expand their capacity at faster rates, Shao warned that the smelting industry was facing a risk of overcapacity.
A combination of slowing demand growth and higher production costs have already caused average profit margins for smelters to fall by 0.7 percentage points to 2.3 percent in the first quarter, he said.
High stockpiles and sluggish demand from late 2012 through earlier this year have caused China’s refined copper imports to drop by about a third to 677,000 tonnes in the first quarter.
(agencies)
Follow our WhatsApp channel