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Copper deficiency is growing

2 September 2014
Copper deficiency is growing

The global industry is increasingly lacking copper — for the period from January to June 2014, the deficit of the red metal rose to the level of 296 thousand tons, as reported by analysts of the «World Bureau of Metal Statistics». And this despite the fact that, according to experts, the output of refined copper increased by 2.7% to 10.8 million tonnes, the level of consumption is 11,056 million tons. Global copper inventories at warehouses declined by 22 thousand tonnes, despite an increase of 5% of production, amounting to 9.23 million tons. However, analysts expect to reduce the cost of copper at the beginning of September of the current year, in line with the decrease in premiums for the supply of the red metal — a kind of evaluation of the compass, indicating the imminent drop in the value of futures. According to Michael Widmer, an expert «BofA/Merrill Lynch," over the past days dropped the American and European awards in connection with the seasonal slowdown in production amid growing concern of consumers about future economic prospects. The probability is that the reduction in demand will reduce the cost of metal, and in early September, the pound of copper will be estimated at 2.94 USD.

The forecasts for 2015 is also disappointing: according to preliminary estimates of analysts «Danske Bank» the cost of one ton of the red metal will rise to 619 USD, which will increase the price to the level of 7725 USD per ton. Earlier forecast was more comforting, the specialists of «Morgan Stanley» and promised an increase in the price of copper by the end of the current year to the level of 7055 USD per ton in 2015, the level was supposed to increase to 7,400 USD per ton. Demand in the US and Europe, continues its growth and the proposal leaves much to be desired.

Meanwhile, the smelting of the red metal in Peru by the end of the year will increase by 9−10% compared to last year. Today successfully tested the new equipment installed in the field «Toromocho», the output of production at maximum capacity according to preliminary estimates will be in the second half of this year, while annual output may reach 275 thousand tons. Deposit, «Antamina» at the moment, has exceeded the previously calculated amount of extracted zinc and copper, last year the number of extracted red metal amounted to 430 thousand tons. In the near future copper production will be achieved both through new and existing projects that will provide an excellent opportunity to strengthen the capacity of Peru by 2016.

1 September 2014
3 September 2014