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Pan Pacific sees copper prices continuing to rise in 2018

Metal News - Published on Wed, 27 Dec 2017

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Reuters reported that Pan Pacific Copper Japan’s biggest copper smelter, expects copper prices to rise more than a quarter over the next two years as global demand continues to grow and outpaces supply. Mr Satoshi Arai senior executive said that Pan Pacific expects copper prices to average USD 7,280 a tonne in 2018 and USD 7,720 a tonne in 2019, against USD 6,100 a tonne this year.

Mr Arai said that “Consumption of refined copper is forecast to increase by 2 percent a year between 2016 and 2020, backed by solid infrastructure demand in developing countries and fresh demand from electric vehicles (EVs) and renewable energy.”

The next two years, though, PPC said refined copper supply will climb only 1.3% in 2018 and 1.6% in 2019.

Mr Arai said that “The global refined copper market will likely face a shortage of 216,000 tonnes next year, up from 51,000 tonnes this year, which will help shore up copper prices further.”

Copper prices have gained nearly 30% this year on a positive outlook for the global economy. Miners have also faced higher development costs due to lower copper content in ores, the far-flung locations of mines and tighter environmental regulations.

Mr Arai said that to enhance mine development, copper prices need to be at least USD 3.50 per pound, or USD 7,716 per tonne.

To meet growing copper demand from EVs and renewable energy, as well as infrastructure demand, PPC said 4.6 million tonnes of copper ore will need to come from new mines by 2030.

Growth in EVs will boost annual demand in global refined copper by an additional 1.6 million tonnes by 2027 from this year, as it takes 60-90 kg of copper to make each new EV, as against 23 kg for a gasoline-powered car.

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Posted By : Rabi Wangkhem on Wed, 27 Dec 2017
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