China Copper Output Said by Jinchuan to Fall 500,000 TonsBy...

China Copper Output Said by Jinchuan to Fall 500,000 Tons
By Bloomberg News - May 24, 2013 6:21 PM CT
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China’s refined copper output in 2013 may fall 500,000 metric tons, about 9 percent of the country’s output last year, on a scrap shortage and delayed commissioning of new facilities, the nation’s third-largest producer said.
“Scrap supply will be even tighter going into June,” said Chen Jie, head of sales and marketing unit of Jinchuan Group Co. The smelter’s own refined production may fall short of a target of 600,000 tons this year by at least 100,000 tons, Chen said in a phone interview today.
Copper in London has retreated 7.9 percent this year on concern that a slowdown in China’s growth could hurt demand from the largest user. A 6.4 percent slump in April has kept scrap dealers unwilling to sell, and China’s ports began tighter enforcement of existing rules in February to weed out low-grade scrap, slowing customs procedures.
“Consumption this year is better than last year,” said Chen, who estimated growth could be 4 percent to 5 percent. “We may not see the lull season in summer as usual, as demand from construction of subways, railways and power grids all seem to be better than last year.”
Refined copper demand is expected to grow 7 percent this year to 8.3 million tons, while production is likely to gain 8 percent to 6.3 million tons, Duan Shaofu, deputy head of the heavy metals department at the China Nonferrous Metals Industry Association said on May 13.
Output at the two biggest Chinese producers, Jiangxi Copper Co. (358) and Tongling Nonferrous Metals Group Co. (000630), has been affected by the shortage, according to Chen. Some planned capacity additions, including Jinchuan’s 400,000 tons, will be delayed, further lowering the nation’s output, Chen said.
China produced 5.82 million tons of refined copper last year, of which 32 percent was made from scrap, according to the industry association.