Domestic copper consumption to grow 14% this year, says CRU

09:25, April 14, 2010      

Email | Print | Subscribe | Comments | Forum 

Copper consumption in China, the world's largest consumer of the metal used in appliances and automobiles, may gain 14 percent this year as the economy extends a recovery, according to CRU International Ltd.

Consumption reached 5.94 million tons in 2009, expanding by more than 20 percent, Grace Qu, a consultant in Beijing at the London-based research and forecasting company, said in an interview. A possible revaluation of the yuan this year wouldn't have a major impact, Qu said on Monday.

CRU's forecast is more bullish than Xstrata Plc's, which said last week copper usage in the world's fastest growing major economy may grow as much as 10 percent this year, supporting global growth of 3 percent. Prices more than doubled in 2009 on stimulus spending and state stockpiling in China.

"While it cannot be compared to last year's growth, which was exceptional, we're still optimistic on China's copper demand in 2010," said Qu, who's been in the industry for almost five years. "However, this may not be reflected by higher prices as stockpiles remain at elevated levels."

The metal for three-month delivery on the London Metal Exchange (LME) rose to more than $8,000 a ton last week for the first time since the collapse of Lehman Brothers Holdings Inc in September 2008 triggered the global recession. The contract was at $7,890 in early morning trade in Singapore, up 7 percent this year.

Speculation has intensified this month that China may scrap or amend the yuan's peg to the dollar as the global economy recovers and Chinese officials seek to damp inflation. The currency has been held at 6.8 per dollar since July 2008.

"Renminbi appreciation is advantageous for imports because at the end of the day, the issue of China's copper imports is all about the price difference between LME and domestic prices," said Qu. "However, I think it will happen on such a small, gradual scale that the impact will be very minimal."

Imports of copper and products by China jumped to 1.07 million tons in the first quarter of 2010, according to customs data. That's 14 percent more than the 936,970 tons in the same period of last year and 51 percent more than the first quarter of 2008, according to Bloomberg calculations.

"Even as producers and consumers work their way through the record imports from last year, imports this year are still high and there is a possibility the market may be in a small 30,000 ton surplus this year," said Qu.

Inventories tallied by the Shanghai Futures Exchange have surged more than nine times in the past year and stood at 169,538 tons last week, the highest level since at least 2003. China's copper imports last year gained to a record.

Source: China Daily

(Editor:黄硕)

  • Do you have anything to say?

双语词典
dictionary

  
Special Coverage
  • Premier Wen Jiabao visits Hungary, Britain, Germany
  • From drought to floods
Major headlines
Editor's Pick
  • On Sept. 26, a resident passes by a flower terrace decorated for the coming National Day. (Xinhua/Hang Xingwei)
  • The photo, taken on Sept. 26, shows the SWAT team ready for the joint exercise. (Xinhua/Wangkai)
  • Two metro trains in Shanghai collided Tuesday afternoon, and an identified number of passengers were injured in the accident, the Shanghai-based eastday.com reported. Equipment failures were believed to have caused the crash on the Line 10 subway, Xinhua quoted local subway operator as saying.
  • An employee at a gold store in Yiwu, located in east China's Zhejiang province, shows gold jewelry on Monday.(Xinhua/Zhang Jiancheng)
  • Tourists ride camels near China's largest desert lake Hongjiannao in Yulin, north China's Shaanx Province, Sept. 24, 2011. Hongjiannao is shrinking as a result of climate change and human activities, and may vanish in a few decades. Its lake area, which measured more than 6,700 hectares in 1996, has shrunk to 4,180 hectares. Its water level is declining by 20-30 centimeters annually and its water PH value has risen to 9.0-9.42 from 7.4-7.8. (Xinhua/Liu Yu)
  • Actors perform royal dance at the Gyeongbok Palace in Seoul, Sept. 27, 2011. A ceremony commemorating the 38th South Korea Sightseeing Day was held in Gyeongbok Palace on Tuesday. (Xinhua/He Lulu)
Hot Forum Discussion