China’s June copper imports
China isn’t self-sufficient when it comes to raw materials. While copper mining is concentrated in Latin America (ILF) (ECH), more than half of the world’s copper is consumed in Asia. China is the largest importer of copper ores, anodes, and refined copper.
Imports rise year-over-year
In June, China imported 420,000 metric tons of unwrought copper and copper products. That was a year-over-year (or YoY) increase of 20.3%. However, imports declined on a monthly basis. Notably, this is the third consecutive month in which imports have fallen on a monthly basis. However, in the first six months, copper imports have risen more than 21% compared to the corresponding period last year.
Imports of copper ores and concentrates, which are processed in China, stood at 1.5 million metric tons in June. Imports have risen ~40% YoY. However, they fell 5.6% compared to May. On a year-to-date basis, copper concentrate imports have increased more than 33%.
It’s a good sign
The YoY growth in China’s copper imports is a good sign for the global copper industry and seems to somewhat defy the slowdown talks. Higher Chinese copper imports support copper prices as well. However, it’s important to note that the increase in Chinese copper imports earlier this year wasn’t exactly backed by end-user demand. Eventually, some of the Chinese refined copper imports found their way into the SHFE (Shanghai Futures Exchange). As a result, SHFE copper inventories rose to record highs.
As China’s refined copper imports started to taper down in April, we saw big drawdowns in the SHFE copper inventory. It has fallen more than 230,000 metric tons since mid-March.
We’ve also seen a lot of shuffling activity in global copper inventory this year. You can explore this more in our series Global Copper Inventory Fluctuates, Leaves Investors Guessing.
You can also visit Market Realist’s Copper page for more updates on this industry.