Copper Consumption, Production, Stocks and Prices in Haver Databases

The price of copper has more than tripled from its low point of $1.2474 per pound on December 24, 2008 to $3.9950 on December 3rd of this year, as can be seen in the first chart which shows the price of copper found in the Haver data base, INTDAILY. 

Copper consumption has not only been rising fast but it has also been exceeding production since 2009.  As a result, stocks are declining and prices are soaring. The Economist Intelligence Unit's (EIU) annual data and forecasts for copper consumption, production and stocks illustrate this point and are shown in the second chart.  The data are found in the EIUDREGS  database.

The rise in consumption is due largely to demand from China.  By comparing Chinese imports of copper ore and concentrates in the EMERGEPR data base with the production of refined copper in the EIUDREGS data base it appears that China's imports of copper have risen from about 12% of worth production in 2000 to almost one third of world production currently.  However, new products, such as hybrid and electric cars, are also responsible for the increased demand for copper.  The high prices might encourage the use of substitutes and thus limit the extent to which the price of copper could rise.   In addition, further official attempts to cool the Chinese economy with higher interest rates would also discourage additional price rises.

Nevertheless, the long term supply situation is likely to play the more important role in determining the price of copper.  Mining companies have been unable to keep pace with the demand, partly because it is getting harder to find the metal and the quality of what is found has deteriorated.  

Cooper  (Thousand Tons) 2012F 2011F 2010E 2009  2008 2007 2006 Stocks 559 742 946 1105 810 666 672 Consumption 20788 20181 19460 18554 18010 18021 17210 Production 20606 19978 19303 18432 18517 18055 17434