Excellent article by Jack Lifton published July 20, 2011 , here's a small clip:
"Any list of those major metals critical for China's ambitions begins with copper. Copper is absolutely essential for the most maintenance-free wiring of a nation and production of the devices that utilize electricity to move people and freight, in the form of the internal windings of the electric motors and generators that literally motivate our 21st century society.
Today, copper is produced as newly refined from ore at a rate of some 16 million tons (Mt.) per annum. In 2010, China already was utilizing 6 Mt. copper per annum-an increase of 500% since 2000. China, however, produced only 1 Mt. copper domestically from Chinese ore in 2010. It, thus, needed to import the equivalent of South America's entire output to satisfy its current demand.
The International Copper Study Group estimates the rate of growth for global copper production is now 4.3% per year (see the following chart). If indeed this is the growth rate, then if (as is almost certain), the growth rate of China's copper demand is so much larger than this that (China's GDP is a measure of the rate of increase of its copper demand), China would use the entire world's newly produced annual copper production by the early 2020s.
Of course, this can't happen. But the consequences of it not happening (i.e., China's growth slowing) are perhaps even more dire for all of us-and there is no other solution to the copper-demand crisis. This is one issue to watch carefully. From now on, copper pricing will of course be volatile but the baseline will be moving up inevitably in each pricing cycle.
China will be the world's largest producer of iron ore by 2020 but will remain a relatively small player in the production of copper ore domestically, as the press release by International Copper Study Group shows.
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From mineweb.com |
