MINEX Forum

Tag: copper demand

  • Copper Demand Expected to Surge as Oil Consumption Declines

    Copper Demand Expected to Surge as Oil Consumption Declines

    Global demand for copper is projected to rise significantly, while oil consumption is expected to decline, reports inbusiness.kz citing EnergyProm.

    In Kazakhstan, copper ore production reached 160.2 million tons in January–December 2024, marking a 7.4% increase compared to the same period in 2023. However, the actual copper content in these ores ranges from 0.5% to 6%, with 5% considered exceptionally rich. The country’s copper concentrate production stood at 567.2 thousand tons, down 2.1% from the previous year, with copper content in the concentrate varying from 8% to 35%.

    Meanwhile, the global demand for copper is surging, with Goldman Sachs referring to it as the “new oil” due to its crucial role in clean energy technologies. According to the International Monetary Fund (IMF), copper demand is set to rise from 25.9 million tons in 2023 to 39.1 million tons by 2040, while oil consumption is expected to fall from 101.9 million to 66 million barrels per day. A significant portion of this growth will be driven by the electric vehicle (EV) industry, where copper is essential for battery components.

    Data from the U.S. Geological Survey indicates that global copper production reached 22 million tons in 2023, with North, South, and Central America dominating the market. These regions host 15 of the world’s 20 largest copper deposits.

    Chile led global production with 5 million tons in 2023, followed by China (1.7 million tons) and the U.S. (1.1 million tons). Russia ranked sixth with 910 thousand tons, while Kazakhstan also secured a spot among the top producers, mining 600 thousand tons.

  • Aurubis Maintains Record-High Copper Premium for 2024 Amid Strong Demand

    Aurubis Maintains Record-High Copper Premium for 2024 Amid Strong Demand

    Aurubis, Europe’s largest copper smelter, announced on Thursday that it will maintain a premium of $228 per metric ton over the London Metal Exchange (LME) price for copper sold to European customers in 2024. This premium remains unchanged from the previous two years, as previously reported by Reuters.

    A spokesperson for Aurubis confirmed that the premium remains at a “record high level” due to the consistently strong demand for copper products across Europe. She cited the ongoing transition to renewable energy as a key factor driving this heightened demand.

    As of Thursday, copper was trading at approximately $9,900 per ton on the LME, a decline of 10% since reaching a record high of $11,100 in May.

  • Conflict in Ukraine Drives Surge in Copper Demand

    Conflict in Ukraine Drives Surge in Copper Demand

    The ongoing conflict in Ukraine has led to a significant increase in demand for copper, according to sources cited by Fastmarkets. Copper is a critical component in munitions, with bullet cartridge casings made from brass, an alloy of copper and zinc.

    In the latest development of the conflict, which has persisted since 2022, a series of Russian missile strikes targeted cities across Ukraine on Monday, including a children’s hospital in Kyiv, resulting in at least 22 deaths and 68 injuries.

    “Every day, the war consumes many tonnes of copper. At the end of the war, there will be a new mine in Ukraine with all that copper scrap,” a producer told Fastmarkets, noting the increasing demand for brass.

    A NATO 155-millimeter artillery shell contains 0.5 kg of copper, with Ukrainian forces reportedly firing up to 7,000 such shells daily, according to the European Defence Agency (EDA). The Royal United Services Institute (RUSI), a UK defense think tank, stated that Russia’s equivalent is the 152 mm shell, with Russia producing 4.5 million shells annually—a 150% increase in output over the past year, as noted by consultancy Bain & Company.

    Bloomberg estimates that before the war, the US produced an average of 14,400 shells per month. However, DefenceOne, a specialist defense industry publication, reported that the country aims to ramp up production to 100,000 monthly shells by the end of 2025.

    “War is good for the metals business,” said Fastmarkets analyst Andy Farida, suggesting that the ongoing conflict in Ukraine is partly responsible for the resilience of copper prices compared to other base metals.

    The military’s demand for copper has garnered significant attention in recent years. Mining magnate Robert Friedland recently told Bloomberg that despite China’s weak real estate market, military demand in the country remains high. “Europe is rearming; Japan is rearming. The United States military is worried about a shortage of 155 mm howitzer shells. Where do you think the world’s army is made out of when all the shooting goes on?” Friedland commented. “If someone is pointing a gun at you, you need that copper to shoot back.”