SHANGHAI, Jun. 18 (SMM) –

Copper Concentrate
According to the NBS, China's copper concentrate output in May was 134,000 mt, up slightly by 2.3% from April's 131,000 mt, and remaining above the historical high of 130,000 mt for a third straight month. According to SMM sources, copper smelters were more inclined to use domestic copper concentrate even while honoring long-term imported copper concentrate contracts, given the extremely low SHFE/LME copper price ratio since early 2012. In addition, import costs for scrap copper, another raw material for copper smelters, rose during May due to the same low SHFE/LME copper price ratio.

Refined Copper
According to the NBS, China's refined copper output in May was 484,000 mt, up 5% YoY, but down by 70,000 mt or 12.6% MoM. China's YTD refined copper output up to May was 2.378 million mt, up 8.1% YoY. Excluding the effect from unit maintenance at some copper smelters, the MoM drop in domestic refined copper output during May was due largely to losses incurred in production, as well as soft downstream demand. The SHFE/LME copper price ratio has remained unfavorable for several months, causing considerable losses for domestic copper smelters who depend on imported copper concentrate, depressing smelter interest in maintaining production. As a result, copper concentrate imports have fallen for the past three months and copper smelters have increased refined copper exports in order to ease production pressures. China's slowing economic growth, lower exports and weak domestic copper semis consumption, even during the seasonal high-demand period, have forced some domestic copper smelters to cut output.

Copper Semis
According to the NBS, China's copper semis output during May was 986,000 mt, virtually flat with the previous month's 993,000 mt. Copper prices were down during May, with spot copper prices falling by RMB 3,000/mt over the course of the month, but still failed to attract downstream enterprises to buy copper semis in large quantities. According to recent SMM surveys, the average operating rates during May at copper wire rod producers rose slightly from last month, but did not increase at copper tube/pipe producers, falling instead by nearly 2% due to the seasonal low-demand period. NBS's data also reveals output of refrigerators, automobiles, integrated circuits, mobile telecommunication handsets, and other products using copper semis, fell in May on a monthly basis. Against a backdrop of slowing investments, consumption, and exports, growth in China's output of copper semis slowed noticeably this year. China's copper semis output rose by 10.5% YoY during January-May, but was down from last year's 15.2%.