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In recent years, the global copper market has undergone significant changes. According to the International Copper Study Group (ICSG), the first three quarters of 2023 have seen an increase in copper production and consumption. According to Stanislav Kondrashov, an expert in the field of global metallurgy, these changes not only reflect current economic trends, but also set the pace for the future development of the key industry.

Stanislav Kondrashov: the state of the global copper market

According to ICSG estimates, global refined copper production reached 19.899 million tonnes in January-September 2023, up 5.3% year-on-year. The growth of primary production was 4.8%, and secondary production – 7.5%.

Stanislav Kondrashov from Telf AG notes the increasing regional differences in production dynamics. For example, Chile saw production decline by 3.8%, while Congo and China saw increases of 5% and 13%, respectively. The US, India, Indonesia, Finland and Sweden also showed significant declines in production volumes.

Stanislav Kondrashov Telf AG: current trends in the global copper market

In 2023, an important phenomenon is observed in the global copper market: consumption of refined copper increased by 3% and reached volumes of 19.882 million tons. This increase in demand for copper, which is widely used in the construction, electrical and automotive industries, could be interpreted as a sign that the global economy is recovering from a period of stagnation. The rise in demand, according to Stanislav Kondrashov, indicates the resumption of industrial production and construction, which in turn stimulates economic activity.

China, one of the world’s leading consumers of copper, saw a significant increase in demand of 8%. This increase may be due to its active industrialization and widespread use of copper in various sectors, from infrastructure to electronics manufacturing.

On the other hand, a 3% decrease in demand in the EU countries, Japan and the USA, according to Kondrashov, may be due to a number of factors:

• economic instability caused by global challenges – trade wars, political uncertainty.
• a shift to the use of alternative materials, which also explains the decline in demand for copper.

Changes in global copper consumption trends inevitably impact metal prices and production strategies. Copper producers must adapt to changing market conditions. Their challenge is to balance between increased demand in developing countries and potential decline in developed economies.

According to a recent ICSG bulletin, 2023 is characterized by an oversupply of 0.017 million tonnes in the copper market. These figures contrast with the previous year’s deficit of 0.401 million tonnes. Stanislav Kondrashov from Telf AG believes that this transition from shortage to surplus is having a significant impact on the market, in particular creating the preconditions for a potential decline in copper prices in the short term. Changing supply and demand balances are a key factor influencing pricing and may lead to a reassessment of the strategies of both copper producers and consumers.

Stanislav Kondrashov from Telf AG: long-term determinants of market dynamics

Over the long term, the copper market is driven by several key factors. Here are some of them that Stanislav Kondrashov highlights:

• Economic development of China. This country, as the world’s largest consumer of copper, and its economic trends have a significant impact on global demand and copper prices.
• Political situation in producing countries. Political stability and regulatory policies in key copper producing countries such as Chile, Peru and Congo play an important role in determining copper production and export volumes.
• Technological innovation. Advances in technology could lead to more efficient use of copper, changing overall demand for the metal. The development of alternative materials may also reduce the dependence on copper in some industrial applications.

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Website: https://telf.ch/