Economy
Chinese copper demand set to rise
By Matt Craze (China Daily)
Updated: 2011-04-06 13:02
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SANTIAGO, Chile - Xstrata Plc said a build-up in copper stocks, responsible for the metal's worst first quarter in a decade, will end in "the next couple of months" as buyers return to the marketplace.
Chinese demand may recover to grow 6 percent this year, Charlie Sartain, who runs the Zug, Switzerland-based company's copper business, said in Santiago on Monday. Demand is also recovering in Europe and the United States, he said.
Xstrata will become the world's largest producer of copper concentrate by 2014 when its Las Bambas mine in Peru starts production, Sartain said. Copper fell 1.8 percent in the first quarter, the biggest decline for the period since 2001, as Chinese buyers consumed existing stockpiles and the country boosted copper scrap imports.
"Both of those trends I think will have an endpoint within the next couple of months," Sartain said. "Then we'll see demand picking up again."
Sartain said copper demand in the US may grow 6 percent this year.
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The Collahuasi mine in northern Chile was affected by heavier-than-normal rainfall in the first quarter, John MacKenzie, the head of Anglo American Plc's copper business said on Friday. Anglo and Xstrata each own 44 percent of Collahuasi. The rain interruptions extended to Teck Resources Ltd's Quebrada Blanca mine in northern Chile, spokeswoman Claudia Onetto said on Monday.
Xstrata's Agua Rica and El Pachon projects in Argentina may deliver 600,000 tons of copper by 2016 through an investment of more than $6 billion, Sartain said. Both projects are subject to feasibility studies starting next year, he said.
The Argentine projects add to Xstrata's $7 billion portfolio of expansions and new mines that the company plans to start up by the end of 2014.
Copper concentrate is an intermediate product obtained from processing ore that is sold to smelters.
Bloomberg News
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