Copper Prices to Find `Support' on Rising Chinese Demand
Chinese copper demand may expand as much as 7 percent this year, outpacing supply, Southern Copper Corp. (SCCO)’s Financial Planning Manager Raul Jacob said.
Copper fundamentals are “sound” as global copper supply has lagged demand this year, with strikes, power shortages and depleting mines curbing output, Jacob said.
China will see “growth in copper demand of 6 to 7 percent this year, which should give support to the copper market in the next few months,” Jacob said today on a conference call with analysts. “Demand from emerging economies is also growing, somewhat offsetting weaker consumption in the European and U.S. markets.”
CRU, a London-based metals consulting firm, forecasts global demand for refined copper this year will expand 3.5 percent, or 675,000 metric tons, while copper supply will grow less than 1 percent, Jacob said. Labor strife halted copper output at mines in Chile, Peru and Indonesia this year.
Southern, the largest copper producer in Peru and Mexico, will increase second-half investment in mine expansions in both countries to meet this year’s $1.5 billion capital expenditure target, Jacob said. The company plans to invest an additional $1.6 billion in 2013, he said.
Copper futures for September delivery rose less than 0.1 percent to settle at $3.4175 a pound on the Comex in New York.
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