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Chinese Copper Output to Shrink on Coronavirus

Metal News - Published on Fri, 07 Feb 2020

Image Source: China Copper, Coronavirus
China Nonferrous Metals Industry Association research arm Antaike said that China’s copper smelters will reduce output by more than 15% in February from last month due to the coronavirus outbreak. Antaike said “Weak downstream demand, high inventories of sulphuric acid and logistical problems mean it is inevitable there will be some reduction in copper output this month. It estimates that more than 15% fall is conservative and March output may also be affected. Downstream copper-processing firms in southern and eastern China have postponed their return to work until February 10 but some Chinese firms will not restart until after February 15, after several regions extended the Lunar New Year holiday. The majority of scrap copper companies plan to resume work on February 10

It added “It is currently known that some ports have been temporarily close. And it remains to be seen whether the epidemic will affect the subsequent import of copper concentrate into the ports.”

Antaike did not provide a tonnage figure for January production but China’s December refined copper output came in at a record monthly high of 930,000 tonnes,

China’s copper smelters face limited scope to slash production even as diminished demand on virus-related lockdowns raises concerns refined inventories could grow. A source said that Daye Nonferrous' 600,000-tonne-per-year smelter in Huangshi City in Hubei, resumed operations on Monday February 3 following the Lunar New Year holiday despite being under quarantine and transport restrictions. The move echoes a trend across China's copper industry. Although demand for the metal has slumped on prolonged factory closures, smelters are reticent to incur the costs of more drastic production cuts.

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Posted By : Yogender Pancholi on Fri, 07 Feb 2020
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