manufacturing slowdown has a negative impact
China recorded a 12% decline in refined copper imports in the first half of 2023 compared to the previous year, the lowest since 2019.
The fall has been exacerbated by rising global copper prices and decreased demand inside China’s economy.
Despite the decrease in refined copper imports, China continues to witness an increase in copper raw material imports, showing a growth in domestic refineVia Metal Miner
China’s refined copper consumption fell by the most in four years in the first half of 2023. The announcement emphasizes the nation’s manufacturing sector’s ongoing slowdown. China is a major buyer of refined copper in the globe. Nonetheless, it appears that the country’s thirst for imports is dwindling. According to Reuters, this not only calls into question China’s continued recovery from COVID-19, but also the future of global copper prices, the majority of which are covered by MetalMiner Insights.
Copper imports continued to fall in July as well. According to latest customs data, China’s copper imports fell 2.7% last month compared to in July was 451,159 metric tons.
Analysts attribute this drop to weak demand in the failing economy and rising global copper prices. Meanwhile, China’s overall manufacturing activity fell for the fourth month in a row in July. Furthermore, its industrial profits fell by double digits for the sixth month in a row, pounding copper demand.
China’s Copper Appetite Remains Dependent on Type
According to experts watching the China copper situation, the market requires government stimulus to revive. Indeed, many regard this as the only option to boost domestic demand and balance out weak export markets. However, copper raw material imports continue to flood into China, resulting in unprecedented domestic refined metal production, as detailed in MetalMiner’s Monthly Metals Outlook report. And, while China has continued to acquire surplus Russian aluminum, the dynamics of copper imports have remained unaltered since Russia launched its invasion of Ukraine in February 2022.
China purchased 1.65 million metric tons of refined copper during the start of this year, a 12% decrease from the previous year’s similar time. This was also the lowest amount of first-half imports since 2019. Meanwhile, net imports fell 13% year on year to 1.48 million metric tons.
In 2022, China’s incoming cargo of refined copper from Russia fell by 20%. This has already decreased by 10% in 2023. In short, while China’s imports of refined copper continue to decline, imports of copper raw materials continue to rise. Nonetheless, the import patterns of refined copper from both Russia and Congo have changed just slightly.
Copper prices fall as a result of China news.
Copper prices fell earlier this week as a result of concerns of reduced demand (get weekly updates in MetalMiner’s free weekly newsletter). Indeed, three-month copper futures on the London Metals Exchange fell 0.7% to $8,511.50 a ton. Similarly, September copper futures on the Shanghai Futures Exchange fell 0.5%, reaching 68,930 yuan a ton.
According to analysts, traders are still cautious about metals demand in China because recent stimulus initiatives have yet to have a substantial influence on growth. Meanwhile, Shanghai metals forecasts that refined copper production will reach a new high of 986,100 tons in August. Aluminum also fell 0.4% on the London Metals Exchange, settling at $2,224.5 per ton of metal output.
