19 Jan, 2007
Copper (October Report)
But there are mysteries in here, if you read it closely. I've taken the liberty of boldfacing what I think is THE key paragraph; it's not the first time USGS has said this (and far from the first time I've included it or written it) -- but it's worth remembering!!!
The report's word piece follows:
Average daily mine production of copper in the United States
rose by about 3% from that in September and was about 18%
above production in October 2005, according to data compiled
by the U.S. Geological Survey (USGS). Smelter production in
October plummeted for the second consecutive month. In
September, Kennecott Utah Copper Corp. (Salt Lake City, UT)
began a 45-day planned maintenance shutdown at its Garfield,
UT, smelter that extended through most of October.
In October, Phelps Dodge Corp. (Phoenix, AZ) closed its Miami, AZ,
smelter for an approximate 30-day maintenance period. The
closure of 2 out of 3 primary domestic smelters resulted in
smelter output in October falling to only about 40% of that in
August (Platts Metals Week, 2006).
Downstream, production of electrolytic refined copper fell in
October by about 24%, and total refined production by about
12% to its lowest monthly total in at least 50 years.
Consumption of refined copper in October declined by about
14% from that in September owing to a 16% decline in wire-rod
production, which was in part attributable to a shortage of
cathode.
Following a build-up of inventories in September,
shipments of wire rod in October declined by only about 7% but
were down by 13% compared with shipments in October 2005.
The U.S. Census Bureau confirmed that export shipments of
copper concentrate to China early in the year were reported as
gross weight and not the purported copper content. Based on
this, and low average unit values reported by the Census Bureau
for most copper concentrate exports, the USGS adjusted current
and historic 2006 concentrate export data (table 15) to reflect
the estimated copper content of the concentrates produced at
nonintegrated U.S. copper mines.
According to data compiled by the International Copper
Study Group (ICSG) (2006), the apparent world balance
between refined copper production and refined copper use for
the first 9 months of 2006 indicates a production surplus of
about 81,000 metric tons (t). This compares with a production
deficit of 319,000 t for the same period in 2005.
Note that in its calculation of the refined copper balance,
the ICSG does not take into account changes in China’s SRB
stocks, which are unreported and which might affect
calculation of China’s apparent consumption.
World refined copper use for the first 9 months of 2006 increased by
about 2.5% compared with use in the same period of 2005.
Europe was the only region showing growth. Total European usage
increased by about 12%, while apparent usage in the European Union-15
countries increased by 15%.
In Asia, usage was down by 1%, as a decrease of about
6% in Chinese apparent use more than offset a growth of about
6% in Japan and 5% in India. In North America, use declined
by about 2%.
On the production side, ICSG data indicate that world mine
production of copper for the first 9 months of 2006 was
essentially unchanged from that in the same period of 2005.
Owing to production difficulties and labor unrest, estimated
global mine capacity utilization decreased to about 86% from
88% in the same period of 2005.
Total world refined production increased by about 6% in the first
9 months of 2006 compared with that of the same period of 2005:
Primary production was up by about 5%, and secondary production
was up by 13%.
References Cited
Platts Metals Week, 2006, Smelter shutdown hits Kennecott output: Platts
Metals Week, v. 77, no. 43, October 23, p. 7.
International Copper Study Group, 2006, Copper—Preliminary data for
September 2006: Lisbon, Portugal, International Copper Study Group press
release, December 18, 1 p.
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