When making seasonal adjustments for world refined production and usage, July showed a production surplus of about 105,000 t. The refined copper balance for the first seven month of 2016, including revisions to data previously presented, indicates a production deficit of around 264,000 t (and a seasonally adjusted deficit of about 191,000 t). This compares with a production deficit of around 70,000 t (a seasonally adjusted surplus of about 32,000 t) for the same period of 2015.
In the first seven months of 2016, world apparent refined usage is estimated to have increased by around 4% (565,000 t) compared with that in the same period of 2015 mainly due to strong Chinese apparent demand. Chinese apparent demand increased by around 9% based on a 14% increase in net imports of refined copper. However July net refined copper imports at 176,000 t were the lowest since April 2013 and compares to a net monthly imports average of 312,000 t in the first half of 2016. Based on Chinese data already available for August, net imports of refined copper were at the same low level as July. Excluding China, world usage increased by 0.5% in the first seven months of 2016. On a regional basis, usage is estimated to have increased by 3.5% in Europe and 6.5% in Asia (when excluding China, Asia usage increased by 1%), while declining by 11% and 4.5% in Africa and in the Americas respectively and remaining essentially unchanged in Oceania.
World mine production is estimated to have increased by around 5% (560,000 t) in the first seven months of 2016 compared with production in the same period of 2015. Concentrate production increased by 6.5% while solvent extraction-electrowinning (SX-EW) declined by 1%. The increase in world mine production was mainly due to a 47% rise in Peruvian output that is benefitting from new and expanded capacity brought on stream in the last two years. A recovery in production levels in Canada and the United States, expanded capacity in Mexico and a ramp-up in production in Mongolia, also contributed to world growth. However overall growth was partially offset by a 5% decline in production in Chile, the world’s biggest copper mine producer and a 9% decline in DRC where output is constrained by temporary production cuts. On a regional basis, production rose by 7% in the Americas and 8% in Asia but declined by 4.5% in Africa while remaining essentially unchanged in Europe and Oceania. The average world mine capacity utilization rate for the first seven months of 2016 remains practically unchanged from that in the same period of 2015 at around 84.5%.
World refined production is estimated to have increased by about 2.8% (370,000 t) in the first seven months of 2016 compared with refined production in the same period of 2015: primary production was up by 2.5% and secondary production (from scrap) was up by 5%. The main contributor to growth was China (+6%), followed by the United States where production increased by 15% and Mexico (+19%) where expanded SX-EW capacity is contributing to refined production growth. Output in Chile and Japan, the second and third leading refined copper producers, increased by around 2% and 3% respectively. Refined production in the DRC and Zambia declined due to the impact of temporary production cuts. On a regional basis, refined output is estimated to have increased in the Americas (6%), Asia (5%) and Oceania (8%) while declining in Africa (-14%) and in Europe (-3%). The average world refinery capacity utilization rate for the first seven months of 2016 remains practically unchanged from that in the same period of 2015 at around 83%.
The average LME cash price for September was US$4,707.18 per tonne, down from the August average of US$4,758.20 per tonne. The 2016 high and low copper prices through the end of August were US$5,103.00 (on 18th Mar) and US$4,310.50 per tonne (on 15th Jan), respectively, and the year-to-date average was US$4,725.17 per tonne (14% below 2015 annual average). As of the end of September, copper stocks held at the major metal exchanges (LME, COMEX, SHFE) totalled 542,858 t, an increase of 60,990 t (+13%) from stocks held at the end of December 2015. Compared with the December 2015 levels, stocks were down at SHFE and up at the LME and COMEX.