Global Copper Market Sees Surplus Amid Rising Production and Consumption

Global refined copper production increased by 3.7% year-on-year to 25.11 million tonnes from January to November 2024, while consumption rose by 2.6% to 24.94 million tonnes, according to the International Copper Study Group’s latest report. This resulted in a surplus of 168,000 tonnes of refined copper during the period, a significant turnaround from a deficit of 89,000 tonnes recorded in the same period last year.

In November, however, the copper market experienced a monthly deficit of 131,000 tonnes, widening from 30,000 tonnes in October. Refined copper production in November rose 1.4% month-on-month to 2.34 million tonnes, while consumption surged 5.7% to 2.47 million tonnes.

China, the world’s largest producer of refined copper, saw a 4.5% year-on-year increase in production from January to November. This growth was driven by the commissioning and expansion of both primary and secondary smelters and refineries. The Democratic Republic of Congo recorded a 12% rise in production during the same period, reflecting the continued ramp-up of new or expanded electrowinning plants. Together, China and Congo accounted for nearly 54% of global refined copper output.

In contrast, production in Chile declined by 7% year-on-year due to reduced primary electrolytic and electrowinning output. Japan saw a 4.4% increase in refined copper production, while global secondary production from scrap rose 3% year-on-year to 4.23 million tonnes.

Global copper demand, excluding China, rose by 1.9% year-on-year in the first 11 months of 2024. Weak demand in the European Union, Japan, and the United States was offset by growing demand in several Asian, West Asian, and North African countries. In China, copper demand increased by 3% year-on-year, bolstered by industrial and infrastructure activities.

The average monthly global copper mine capacity increased to 2.38 million tonnes during January to November 2024, compared to 2.28 million tonnes in the previous year. However, the mine utilisation rate fell to 79.1% from 81.1% during the same period, reflecting operational inefficiencies.

Copper stocks at major exchanges rose significantly, doubling to 430,228 tonnes in November compared to the end of December 2023. On the London Metal Exchange, the average cash price for copper fell by 1.7% to $8,919.53 per tonne in December from $9,074.79 per tonne in November. As of 1100 IST on January 17, the most-active three-month copper contract on the LME was trading at $9,255.50 per tonne, down 0.3% from the previous close.