SHANGHAI, Jan 27 (SMM) - According to SMM research (involving 41 sample companies, covering an installed production capacity of 11.16 million mt), the planned output of mainstream smelters across China for 2022 stands at 10.45 million mt, an increase of 650,000 mt or 6.56% over the actual output of mainstream smelters in 2021.
The main increase comes from the new and expansion plans of domestic smelters in 2021-2022, especially the new and expansion projects of smelters in east China and central China in 2022, which account for 50% of the total increase in 2022. Meanwhile, the new and expanded capacities as well as the resumed capacity of several smelters in 2021 will also gradually reach optimal production in 2022. At the same time, 2021 saw concentrated overhauls, and some of the smelters have been growing steadily in terms of copper cathode output after recovering from the overhauls.
From the raw material side, after experiencing unusually tight supplies of blister copper and anode in the second half of 2021, the blister copper and anode market has been gradually picking up, with domestic imports of anode recording 90,583 mt in December 2021, up 10.2% YoY. As the global supply chain problem eases, the smelters’ output affected by the shortage of blister copper and anode early in the year will gradually return to normal.
The copper concentrate market is also showing signs of improved supply in 2022, with the SMM import copper concentrate index currently standing at 63-65, also a 2-year high. Meanwhile, although the prices of sulphuric acid have fallen significantly compared to the second half of 2021, the smelters are still profitable. Meanwhile, the TCs are expected to run at a high level. Hence the smelters will maintain relatively high production enthusiasm throughout 2022.
