China Cu Output Data Analysis in February 2011

SHANGHAI, Mar. 21 (SMM) –

Copper Concentrate
According to China’s National Bureau of Statistics (NBS), China’s output of copper concentrate was 88 kt in February, up slightly from January’s 86 kt. Higher copper prices greatly stimulated production at domestic ore producers despite the Chinese New Year holiday, with high operating rates at mines reported.    

Refined Copper
According to NBS, China’s output of refined copper was 386 kt in February, down 23 kt from January’s 409 kt, but up 3.8% YoY. Although most domestic copper smelters remained online during the Chinese New Year holiday in early February, there were fewer working days in February, limiting actual output. In addition, some copper smelters with scrap copper as raw materials had to reduce output due to tight scrap copper supplies. In this context, refined copper output was lower in February. SMM believes China’s output of refined copper will exceed 400 kt in March as a result of the arrival of a seasonal high production period in March and the resumption of production at Yunnan Copper following unit maintenance.
 

Copper Semis
In marked contrast to slight declines in refined copper output, China’s output of copper semis was down significantly in February. According to the NBS, China’s output of copper semis was 603 kt in February, down 99 kt, or 14.1%, from 702 kt in January. Unlike domestic copper smelters, domestic copper semis producers generally suspended production for the Chinese New Year holiday, only resuming production in late February.  

Domestic spot copper prices fell sharply due to the unrest in the Middle East and the earthquake in Japan. End-user purchasing interest improved after prices slid below RMB 70,000/mt, helping improve operating rates at copper semis producers. In this context, SMM expects China’s copper semis output to rise sharply in March.

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