Theme of the Day: Copper market in 573kt surplus in H12024 – ICSG

The International Copper Study Group (ICSG) released preliminary data for H12024 covering world copper supply, demand, inventories, and the market balance in its Aug 2024 Copper Bulletin. The world refined copper balance for H12024 indicates a surplus of 573kt.

World copper mine production increased by about 3.1%, with concentrate production increasing by 2% and solvent extraction-electrowinning (SX-EW) growing by 7%. Global mine production in 2024 is benefiting from a recovery from 2023 reduced or constrained output (mainly in Chile, Indonesia and the US) and also additional output from major mine projects starting or ramping up to capacity. Production in Chile increased by 2.4% YoY, with concentrate output up by 2.5% and SX-EW up by 2%. In Peru, copper mine production declined by 2%. Preliminary data indicates that output in the DRC grew by about 8.5% mainly as a consequence of the expansion of the Kamoa mine together with new/expanded capacity at other mines. Indonesian output is assessed to have increased by 33%, recovering form operational constraints at the Grasberg and Batu Hijau mines in Q123; US output is estimated to have grown by 10% principally due to a recovery from reduced production in Q123. As production at Cobre Panama mine was suspended last Nov, there is no longer any Panamanian output.World refined copper production increased by 6.2% with primary production (electrolytic and electrowinning from ores) up by about 5.7% and secondary production (from scrap) up by 6.3%. Preliminary official Chinese refined production data indicate a rise of about 7%.

World apparent refined copper usage grew by about 3.3%. Growth in world refined usage was mainly supported by strong apparent demand in China, with usage in the rest of the world estimated to have increased by 3%. Chinese apparent demand (excluding changes in bonded/unreported stocks), grew by around 3.5%. (Chinese net refined copper imports increased by 9%). Weak demand in the EU, Japan and the US negatively impacted world ex-China refined usage but was offset by growth in a number of Asian countries.In H12024, the world refined copper balance, based on Chinese apparent usage (excluding changes in bonded/unreported stocks), indicated a preliminary surplus of about 488,000t. The world refined copper balance adjusted for estimated changes in Chinese bonded stocks suggested a market surplus of 573,000t.China’s bonded stocks have increased by about 85,000t in H12024 compared to the year-end 2023 level. As of the end of Jul 2024, copper stocks held at the major metal exchanges (LME, COMEX, SHFE) totalled 559,984t, an increase of 346,134t (+162%) from stocks held at the end of Dec 2023. Stocks were up at the LME (+79,450t) and at SHFE (+270,298t) but were down at COMEX (-3,614t).