China Expands Copper Import with Strong Demand

Chinese copper import increases due to higher demand when the government invests infrastructure under 4 trillion yuan of stimulus package. The import reached around 750,000 tonnes in January-March, which represented around half of 2008 import, partly due to Chinese major smelter’s production accident. Japanese industry expects the import could reach 600,000-700,000 tonnes in April-June when Chinese buyers keep ordering to Japanese smelters. The annual import of China could reach 2 million tonnes in 2009.

Chinese copper consumption was 5.2 million tonnes in 2008, according to International Copper Study Group. The country imported 1.4 million tonnes of ingot when the production was only 3.8 million tonnes. However, the import hit monthly record at 300,000 tonnes in March after 180,000 tonnes in January and 270,000 tonnes in February.

Chinese government tries to secure 8% annual gross national production growth through the major package. Japanese industry source expects the investment mainly for power and rail infrastructure expands the copper demand while some demand is to build inventory. Japanese industry source expects Chinese copper consumption increases to 5.5 million tonnes in 2009.

Chinese major smelter, Jiangxi Copper reduces the production due to accident at the production facility. Chinese buyers expand the import from Japan and neighbor countries under the lower domestic production and the government’s purchase program. Chinese buyers expand the import when copper price at London Metal Exchange is lower than the price at Shanghai Futures Exchange.