Refined copper market surplus up to 40,000 mt in January 07: ICSG
Source: Platts
The refined copper market had an apparent production surplus in January 2007 of about 40,000 mt, increasing to about 58,000 mt after making seasonal adjustments for world refined usage and production, the International Copper Study Group said in a preliminary data release for January 2007 Tuesday.
The ICSG said this figure compared with a production surplus of 14,000 mt, seasonally adjusted 31,000 mt, in January 2006. The group noted that in its calculation of the refined copper balance, it did not take into account changes in China's SRB stocks, which were unreported and, particularly for 2006, might affect calculation of China's apparent consumption.
It said further that beginning in January 2007, the ICSG introduced a more rigorous calculation of seasonal adjustment that included both refined copper production and usage and was based on the United States Census Bureau's X-12 seasonal adjustment procedure.
The ICSG said in January 2007 that world refined copper usage was estimated to have increased by 6% when compared with that in January 2006.
This growth was mainly attributed to Asia, where Chinese apparent usage increased by 27%, and Indian and Japanese usage were up by 17% and 9%, respectively, it said. The ICSG noted that total European usage increased by 1%, while apparent usage in the European Union-15 countries remained flat. In North America usage was down by 10%, with a decrease of 21% in US usage more than offsetting increases in Canada and Mexico, the study group said. It noted however, that US usage in January 2006 had been exceptionally high and US usage was up by 25% from December's low level. In Oceania and Africa usage declined by 3.7% and 4.6%, respectively, ICSG said.
The group said on the supply side, preliminary data indicated that world mine production increased by 9% in January 2007 compared with production in January 2006. "Concentrate production was up by 7%, and SX-EW production was up by 17%. The main contributors to this increase were Indonesia (Grasberg Mine lower ore grades and Batu Hijau Mine wall pit instability and milling of harder ore had reduced production at the beginning of 2006), where production was up by 40%, Chile (7.6%) and Africa (30%)," said ICSG.
It said that global mine capacity utilization increased to an average of 88.5% from an average of 83.8% in the same month of 2006. However, January 2007 world mine production was 4.5% below the average monthly production for Q4 2006, and 7% below December 2006 production.
Total world refined production increased by 8% in January 2007 compared with that of the same period of 2006: Primary production was up by 7% and secondary production (from scrap) was up by 12.5%, the group said, adding that refined capacity utilization averaged 85.4%, up from 82.5% in the same period of 2006. All major producing countries increased their production; Chile (11%), China (4.5%), Japan (9%), the United States (3.7%), Russia (6.8%) and India (14%), said ICSG. |
