Sept. 24 (Bloomberg) -- Copper consumption may fall in a key wire and cable making region of China, the world's biggest user, as a slowdown in U.S. demand cuts exports, an industry group official said.

Exports from Guangdong, the country's biggest cable and wire production centre after the Yangtze River Delta, may drop in the next six months, with orders received by Taiwan producers in Dongguan city alone falling as much as a third, said Ke Hongqi, vice chairman of Taiwan Businessmen Association Dongguan.

Reduced demand from China may pressure copper prices which have fallen 22 percent from a July record of $8,940 a ton on the London Metal Exchange as global economic growth cools. The widening credit crisis roiling global markets has spurred concern that growth could slow further, curbing demand for raw materials.

``Copper consumption from the city and the province will fall accordingly,'' said Ke, also the board chairman of Dongguan-based Lucky United Electric Wire & Cable Co. ``We expect our order books to pick up after nine months, if the U.S. government's rescue plan works.''

Federal Reserve Chairman Ben S. Bernanke and Treasury Secretary Henry Paulson told Congress that failing to pass a $700 billion bailout of the banking system would stall the economy.

While China's domestic demand for copper wires and cables remains robust, almost 90 percent of the Dongguan cablemakers' business is from exports, Ke said. Cable and wire manufacturers account for half China's copper consumption.

China Lure

Taiwan businesses in Dongguan, numbering about 4,000, have annual exports of $20 billion, 40 percent of which is from copper-intensive industries such as cable and home appliance makers, according to the association.

Companies and individuals from Taiwan have invested as much as $150 billion in China since the late 1980s after economic ties were eased, attracted by lower labor and land costs.

Lucky United, a medium-sized manufacturer using 8,000 tons of copper a year, and other Taiwanese cable makers in Dongguan export their products mainly to the U.S. and also to Europe and Japan. They purchase overseas copper for the tolling trade, a practice that allows manufacturers to buy tax-free raw material for export-bound products.

Demand for cables and wire slowed this year as power infrastructure projects in northern China were suspended because of the Beijing Olympics and government tightening policies curbed economic growth, according to Nexans (China) Wires & Cables Co., a unit of Nexans SA, the world's biggest cable maker.

China's apparent demand for copper grew by just under 4 percent in the first eight months and fell by 0.6 percent in August, from a year ago, Macquarie Group Ltd. said in an e- mailed report Sept. 20. Apparent demand is production plus net imports minus reported inventory change.

Imports of refined copper and alloys declined 16 percent to 1.02 million tons in the first eight months as credit tightening and the Olympics suppressed demand.

To contact the reporter on this story: Li Xiaowei in Dongguan at xli12@bloomberg.net.

Last Updated: September 24, 2008 05:45 EDT