Global copper supply forecast to fall 603,000t in 2020
Global copper supply will fall by 603,000t or 2.9% this year but will recover in 2021, according to Chile’s copper commission Cochilco.
“Most affected countries will be Peru with a drop of 15%, Mexico with 20% less copper production, and Chile with a 1.2% fall,” Cochilco’s head of studies and public policies, Jorge Cantallopts, said in a webcast on Thursday.
However, for 2021 Cochilco predicts an increase of 1.01Mt in global copper supply to 21.1Mt, representing 5.1% growth. Supply will grow most in Mexico (23.5%), Peru (14.8%) and Zambia (12.8%), the agency said in a report.
Chile’s copper supply is expected to drop to 5.72Mt this year but will rise 1.9% to 5.82Mt in 2021.
Despite the health crisis, Chilean copper mines continue to operate – with up to 52% less personnel. COVID-19 cases at mining facilities surpassed the 5,000, which represents around 2% of the industry.
DEMAND
Global demand of the red metal will also fall. Cochilco forecast a 3.2% drop to around 23.1Mt this year but an increase of 3.2% to 23.8Mt for 2021.
Cantallopts also said that a market surplus of 131,000t exists for 2020 and of 171,000t for next year.
PRICE
Cochilco increased the 2020 forecast for the average price to US$2.62/lb, up from US$2.4/lb expected in April.
For 2021, Cochilco now forecasts US$2.85/lb instead of US$2.90/lb.
Risks related to a potential second wave of COVID-19 infections in the US and Europe will maintain the price volatility, Cochilco said.
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