China demand to keep copper supply tight

Strong demand from China would keep the world copper market in a supply deficit next year, Canada's Falconbridge Ltd. said Monday.

But the deficit should shrink to 372,000 tons next year after swelling to 799,000 tons this year as more metal is produced, Ian Pearce, Falconbridge's vice president for projects and engineering, told an international meeting of miners.

"China is driving copper demand," Pearce said. "By 2010, China will account for 25 percent of the world's consumption of copper."

"With a current base of three million tons, that represents an average annual increase of approximately 300,000 tons," Pearce said.

This compared with global demand for copper of 16 million tons this year, he said.

Falconbridge, owned 58.9 percent by Canada's Noranda Inc., mines copper from the Collahuasi and Lomas Bayas lodes in Chile and Kidd Creek in Canada.

It was announced by Noranda on Friday that China's Minmetals Corp. was in exclusive talks to acquire all or part of Noranda in a deal that could be worth more than US$5 billion.

Such a deal is seen as helping to feed China's soaring demand for base metals.

Falconbridge was the world's eleventh-largest producer of copper and this year expected to churn out a record 350,000 tons of the metal, used in everything from plumbing to computer chips, Pearce said.

Source: Shenzhen Daily-Agencies