ICSG: Global Copper Deficit Reaches 190,000 Tons in First Five Months of 2019

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Bombardho/Adobe Stock

According to a recent report from the International Copper Study Group (ICSG), the global copper supply deficit came in at 190,00 tons for the first five months of the year.

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The ICSG reported global copper mine production fell 1% during the first five months of the year on a year-over-year basis. In addition, concentrate production fell 0.2% and solvent extraction-electrowinning (SX-EW) production fell by 3.5%.

A decline in output in Chile and Indonesia offset growth in other countries, according to the report.

Production in No. 1 copper producer Chile declined 3% based on lower copper head grades, while Indonesian concentrate production plunged 55% “as a consequence of the transition of the country’s major two mines to different ore zones leading to temporarily reduced output levels.”

Last year’s production growth in the Democratic Republic of the Congo and Zambia has come down this year, as production in the two countries in the first five months has been flat compared with last year.

Meanwhile, No. 2 producer Peru saw a production increase during the aforementioned period, as did Australia, China and Mongolia.

Meanwhile, refined output also declined 1% on a year-over-year basis. Primary production declined by 1.5%, while secondary production from scrap increased by 1.0%.

Chile’s refined output fell 37% and India’s output fell 36% as a result of the shutdown of Vedanta’s Tuticorin smelter (shuttered since April 2018). Zambian refined output fell 28% “due to power supply interruptions, smelter outages and the introduction on 1st January 2019 of a 5% custom duty on copper concentrate imports constraining smelter feed.”

Reduced output was also seen in Japan, Peru, the U.S. and some European countries.

Apparent refined usage was flat in the first five months of the year.

In terms of prices, after making gains in July the copper price has plunged to its lowest level since mid-2017.

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For the year through the end of July, the high and low copper prices came in at U.S. $6,572 per ton (March 1) and U.S. $5,756 per ton (June 17), respectively.

The average price for the year through July checked in at U.S. $6,129.40 per ton, down 6% from the 2018 annual average.

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