SHANGHAI, Feb 4 (SMM)—Myanmar’s military seized power on Monday in a coup against the democratically elected government of Nobel laureate Aung San Suu Kyi, who was detained along with other leaders of her National League for Democracy (NLD) party in early morning raids. The army said it had carried out the detentions in response to “election fraud,” handing power to military chief General Min Aung Hlaing and imposing a state of emergency for one year, according to a statement on a military-owned television station.
The Monywa Letpadaung copper mine in Myanmar is an extra-large porphyry copper mine with 5.4 million mt of copper resources. Its development agreement was signed in 2010 under the witness of the prime ministers of China and Myanmar. With total investment of $1.09 billion, it was put into operation in 2015 and yielded output in 2017, producing 100,000 mt of copper cathode every year.
Myanmar is China’s 12th largest copper cathode supplier. In 2019, China imported 88,100 mt of copper cathode from Myanmar, and the figure rose 23.27% on the year to 108,600 mt in 2020, accounting for 2.4% of China’s total copper cathode import, after Monywa-LPT was listed on London Metal Exchange (LME) in September 2019.
Total copper cathode imports that rose significantly in 2020 also contributed to the increase in import from Myanmar. China imported a total of 4.6 million mt of copper cathode in 2020, jumping 32.2% from a year earlier, an SMM survey showed. Chinese enterprises recovered from the COVID-19 pandemic earlier than their counterparts overseas. Improved domestic consumption led to a large inflow of imported copper into the domestic market after the import arbitrage window opened. China's actual consumption of copper cathode increased 7.7% year on year to 12.98 million mt in 2020, while LME copper stocks at one point dropped to around 73,625 mt.
SMM expects copper cathode imports to fall sharply in 2021 as copper stocks in the bonded zone returned to around 360,000 mt in the second half of 2020 after the large inflow of imported materials. As exports from Australia to China have been restricted due to trade tensions between the two countries and supply from Chile and Peru is unstable because of issues like the pandemic, weather and earthquake, China will rely more on copper cathode imports from Japan, South Korea and South-east Asia countries in 2021.
Therefore, the military coup in Myanmar will barely affect copper cathode supply in China in the short term.