Balanced World Copper Supply in 2010, Pan Pacific Copper

Japanese largest copper smelter, Pan Pacific Copper revised the world copper outlook with balanced supply in 2010 while the firm expected 300,000 tonnes of oversupply as of the beginning of the year. The firm now expects the demand is better than expected due to economy recovery in developed countries and economy growth in emerging countries while the supply growth is limited due to limited supply of copper ore. The firm expects the supply and demand is 18.5 million tonnes.

The firm expects the demand will increase by 7% in 2010 from 2009 while the firm expected 3% growth before. The firm expects Chinese copper demand will reach 6.7 million tonnes in 2010 after the demand increased to 6.5 million tonnes in 2009 from 5 million tonnes in 2008.

The firm expects Chinese higher demand leads world demand growth in 2010 due to huge stimulus package including infrastructure investment for power plants and rail network. The firm expects the demand in developed countries will increase from the bottom when Japanese demand recovered 80-90% level of the peak for automobile and appliances.

The firm expects world copper supply will increase by 1% in 2010 from 2009 while the firm revised the supply upward by 300,000 tonnes from former estimate. The firm expects lower ore grade and limited expansion for ore output capacity is neck for higher copper output. With the limited copper supply, the firm expects the world supply is balanced in 2010 after around 1 million tonnes of oversupply in 2009.