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MIIT: Copper Industry Status In 2018

Our copper industry maintained a smooth operation in 2018. Benefits increased while price growth slowed down; environmental pressure increased; downstream consumption was in recession.

Firstly, yield presented a YOY growth and technologies developed swiftly. In 2018, yield of our copper concentrate (amount of metal), refined copper and copper material was 1.51 million tons, 9.04 million tons and 17.16 million tons, respectively YOY growth being 3.9%, 8% and 14.5%. As more enterprises are pursuing green and smart reconstruction and developing deep processing, fixed investments in copper industry rose again. Technologies are making great progress. Comprehensive energy consumption of copper smelting was 230.7 kg standard coal/ton, presenting YOY decrease of 2.5%; comprehensive yield rate of copper material was 79.6%, YOY up by 3.5 percent points.

Secondly, price came down after shock and benefits growth fell. In 2018, influenced by trade frictions, stronger US dollar and weak demands, copper price came down after shock. Spot price of copper in 2018 was RMB 50689/ton, presenting a YOY growth of 2.9%, with the growth rate falling by 26.3 percent points YOY. Total profit of copper industry was RMB 39.6 billion, presenting YOY growth of 4.3%, with the growth rate falling by 25.8 percent points YOY. Wherein, profit of mining and beneficiation was RMB 5.6 billion, presenting YOY decrease of 11.5%; Profit of copper smelting and copper processing was RMB 14.7 billion and RMB 19.3 billion, respectively presenting YOY growth of 9.9% and 5.8%, while YOY growth rate falling by 23.5 percent points and 12.3 percent points.

Thirdly, import and export trade continued to increase and foreign-trade dependence continued to rise. According to statistic data from Non-ferrous Association, import and export trade volume of copper product in 2018 was USD 86.8 billion, YOY growth of 20.3%. Wherein, import volume was USD 79.8 billion, YOY increase of 17.3%; export volume was USD 7 billion, YOY increase of 7.9%. From the perspective of product category, in recent years, import volume of copper product continue to grow swiftly and copper resource foreign-trade dependence continued to rise. In 2018, net imported volume of copper in China in 2018 increased by 36% compared to that in 2013. With the implementation of “Foreign Waste Import is Forbidden”, imported copper scrap presented a YOY decrease of 32.2%; export of copper processing material continued to rise. Accumulative export volume reached 510000 tons, presenting YOY growth of 6.7%.

Fourthly, environmental pressure increased; downstream consumption was in recession. In 2018, governance on pollution was strengthened and solid waste import strategies was tightened. Green development is even more emphasized in this industry. Domestic yield of auto and generating equipment presented YOY decrease; yield of white household appliances reduced even more swiftly. Overall consumption of copper industry was far from satisfactory. According to statistic data from association, copper consumption volume in China in 2018 was 13.05 million tons, presenting a YOY growth of 2.5%, with growth rate falling by 4.6 percent points.

In 2019, domestic and foreign environment is getting more complicated, which will influence copper market and domestic end-manufacturing industry. Domestic copper consumption will continue to slow; environmental pressure will keep going up; downward pressure will get prominent in copper industry. The main direction for high-quality industrial development is to build whole-process green manufacturing system and develop high-end copper materials. MIIT will support copper industry in accelerating technical transformation and facilitate the industry to lay more emphasis on improving resource utilization and energy conservation and emission reduction during full life circle from just focusing on product quality and performance. MIIT will also facilitate to build smart copper mine and smart plant to achieve green and smart development. We need to give full play to functions of copper, actively develop high-end copper material and extend copper applications so as to support the development of strategic emerging industry and defense-related science and technology.