March 29, 2019 / 8:57 AM / 24 days ago

China's refined copper imports to fall almost 15 pct in 2019 - Antaike

BEIJING, March 29 (Reuters) - China’s imports of refined copper are set to fall 14.7 percent this year as the country churns out more metal domestically, a research house said on Friday.

China is the world’s top consumer of copper, widely used in construction and manufacturing, and its imports of all forms of the metal are closely watched by metal markets.

It will import around 3.2 million tonnes of refined copper in 2019, down from 3.753 million tonnes in 2018, Yang Changhua, principal copper analyst at Antaike, the research arm of the China Nonferrous Metals Industry Association, said in a presentation in Beijing.

By 2020, Yang sees refined copper imports slipping another 6.3 percent to 3 million tonnes as Chinese smelting capacity continues to expand this year and next.

In China, “it is estimated that (refined copper) output in 2019 will be 8.85 million tons, an increase of 4.8 percent. Consumption growth will slow down from 4 percent last year to around 3 percent,” Yang said.

Global supply of copper concentrate, the ore mined and then processed into refined copper, is expected to increase by 1.5 percent this year, slowing from 2.5 percent in 2018, with only two mines — Cobre Panama in Panama and Chuquicamata in Chile — set to boost annual output by 100,000 tonnes or more, Yang said.

With China’s copper concentrate consumption projected to rise by 7.2 percent this year, its reliance on overseas supply is set to increase to 5.15 million tonnes on a copper-contained basis, up from 4.74 million tonnes last year.

Growing smelting capacity has increased competition for copper concentrate in China, pushing treatment and refining charges (TC/RCs) lower.

The China Smelters Purchase Team, a group of 10 Chinese copper smelters, on Thursday cut their TC/RC floor by more than 20 percent to $73 a tonne and 7.3 cents a pound, the lowest quarterly floor since at least 2015.

Meanwhile, China’s ban on low-grade scrap copper from the start of this year, which has led to higher refined copper imports, is due to be extended to all scrap by the end of 2020.

Chinese government departments are studying the development of quality standards for scrap copper and aluminium material and attempting to have their designation changed to a “resource” instead of solid waste, Yang said.

“If there is no policy change, there will be no way to import,” he added. (Reporting by Tom Daly; editing by Christian Schmollinger)

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