SHANGHAI: China is forecast to add 400,000 mt mined copper demand in 2018, due to the anticipated commissioning of new copper smelting projects next year, Jiangxi Copper Corp said in its 2018 copper sector report.
The producer said China was forecast to put into use a total of 2.5 million mt/year new blister copper output capacity over 2017-20, with an estimated 440,000 mt/year blister copper capacity to be commissioned in 2018.
It said as some of the blister capacity might be commissioned in H2, 2018, thus delaying demand for concentrate, with new copper concentrate demand in China seen at 400,000 mt next year.
Jiangxi Copper said Chinese demand for copper concentrate was expected to rise further in 2019, on the anticipated commissioning of Aluminum Corp of China’s 400,000 mt/year refined copper project at Ningde City, Fujian Province, South China, as well as Yunnan Copper’s 300,000 mt/year refined copper project at Chifeng City, Inner Mongolia, Northwest China next year.
The producer said as China’s mined copper output growth could not meet all smelters’ needs, with an estimated of just 80,000 mt new mined copper output in China in 2018, so pressuring down treatment and refining charges. It said the negative impact on TC/RCs were expected by H2, 2018.
China imported 15.698 million copper ore and concentrates in January-November, up 2.68% year on year, data from the General Administration of Customs showed.
Meanwhile, Jiangxi Copper said China’s restriction of copper scrap imports was expected to spur a periodic refined copper shortage next year.
The producer said an estimated 350,000 mt of Category 7 copper scrap waste copper wire, cable and waste electrical grade could not be imported by China in 2018 on China’s scrap metal import restriction, which was expected to result in the 350,000 mt scrap to lie idle in overseas, then processed into Category 6 copper scrap (purple copper and yellow copper), and then exported to China.
Jiangxi Copper forecast China to add national refined copper output of 420,000 mt in 2018, with domestic refined copper demand rising by 280,000 mt next year.
The producer predicted China’s copper scrap imports in 2018 to dip, cutting domestic copper scrap supply, lifting the refined copper shortage, hiking imports of refined copper next year.
Meanwhile, China’s starting of an environment protection tax by Jan 1, 2018, is expected to impact around 370,000 mt/year domestic mined copper capacity next year, as it would hike mining costs, Jiangxi Copper said. It said the new tax could also affect the domestic copper smelting sector, exerting financial pressure on new projects.
Producers are asked to pay taxes of Yuan 15/mt ($2.25) for copper waste disposal and Yuan 25/mt ($3.75) for processing slag next year, according to the Ministry of Environment Protection.
