Copper is the third most commonly used metal due to its availability and conductivity. The demand for copper is increasing globally. According to Fitch Solution, the market supplied demand will get increased from 23.6 MT in 2018 to 29.8 MT by 2027.
Why did the Demand for Copper Increase?
The demand for copper is mainly driven by the power industry, infrastructure sector and rising electric vehicles. The use of electric vehicles is booming in China which was the reason for the hike copper import by 479000 tonnes in January 2019. This imported copper was turned into refined copper and it touched 1.895 million tonnes of refined copper in January. The copper used in electric vehicles is three to four times more than the usage in traditional vehicles. China will soon ban the pollution causing diesel engines which would also increase the usage of copper.
Global Consumers of Copper:
It is predicted that the consumption of copper in China will increase from 11.7 million tonnes in 2018 to 15.9 million tonnes by 2027. Also the consumption of US refined copper from 1.5 million tonnes in 2018 to 1.7 million tonnes by 2027 and in India, it will reach up to 1.5 million tonnes by 2027 due to the demand of copper from power, auto and consumer sectors.
Top Global Producers of Copper:
Chile is the world’s top producer of Copper. The second top producer of copper in China followed by Peru and the United States of America. China is maintaining a steady growth of copper production. It has aimed to improve the production rate to 11.4 mt by 2027.
China the Dominant Consumer of Copper:
China is responsible for a 40% demand of copper globally and is expected to remain the dominant consumer of copper. The demand will even get hiked due to the constructive projects in China. Also, the demand for copper increases as China is making the transition from the Internal Combustion Engine to Electric cars.
Supply downfall in Indonesia:
The global copper market will face an Undersupply situation as the mine supply is expected to get slow down due to the decline in the output of Indonesia Copper mine. So the export of copper ore is expected to fall from 1.2mt in 2018 to 0.2mt in 2019.
Huge Demand Raised the Price of Red Metal.
The increasing copper demand will make a huge influence on copper price. Last year the global demand for red metal raised to 23.6 million tons and it is also predicted that the demand for the red metal will reach 30 million tons by 2027. The copper price also increased by 0.45 per cent in 2019. The production of copper by making use of copper waste can cut down the production cost.
Cost can be lowered by following recycling:
The supply and demand play a major role in fixing the price of a commodity. The supply slows down and heavy demand for copper would make a drastic change in copper in the following years. The metals gain more value when they are recycled again and again. The production of copper from copper scraps will be largely adopted to avoid undersupply of copper. The Production cost of copper can be reduced by adopting recycling.
About Anandhi Anthiran
Hi, I’m Anandhi Anthiran born at Kanyakumari, India. We are five members in our family. I have two
younger sisters. About my schooling, I took my elementary education at Chennai. When I was 10 years
old, our family got permanently shifted to Kanyakumari as it is our native land. Kanyakumari, the .... more info