China Cu Output Data Analysis In August

SHANGHAI, Sept. 19 (SMM) –

Copper Concentrate
According to China's National Bureau of Statistics (NBS), China's copper concentrate output was 115 kt in August, up slightly 1 kt from July's 114 kt. SMM believes copper price fluctuations will have only a limited impact on copper concentrate output in the short term. If the weather remains mild and there are no other outside factors, China's copper concentrate output should remain stable.

Refined Copper
According to the NBS, China's refined copper output during August was 518 kt, another record high and up 40 kt from July's 478 kt. 

Based on a recent SMM survey of major domestic copper smelters, copper output during August at medium and large-sized copper smelters was stable or down slightly from July levels. Any increase in refined copper output reflected in NBS data should be probably due to increases at small-sized copper smelters. However, as copper prices moved lower during August, smaller copper smelters, which use scrap copper as raw materials, had no incentive to increase copper output since slower scrap copper price declines were still cutting into profit margins. Besides, no new copper smelting projects were put into production during August based on SMM statistics. Hence, SMM is skeptical toward NBS output data of refined copper for August, but believes output will likely fall in September.

Copper Semis
According to the NBS, China's August output of copper semis was 1.01 million mt and relatively stable following declines in July and increases in June.

Based on an SMM survey of downstream enterprises, production at copper semis producers did not fully resume during August, with operating rates at copper tube/pipe producers at a  yearly low. Operating rates at copper rod, plate and strip producers, however, began to stabilize. In addition, copper price fluctuations at low levels during August also helped increase orders.    

As export markets begin to recover in September, demand for copper semis from end-consumers will improve, and SMM believes China's output of copper semis during September will remain above 1 million mt.