The annual report contains an interesting section on the global copper market.
Global refined copper demand is estimated to have been approximately 25 million tonnes in 2023, representing a 3% increase year on year. China continues to be the main consumer, representing 55% of the total with nearly 14 million tonnes.2 To put this in perspective, the second largest source of copper demand is Europe, with a 12% market share of approximately three million tonnes.3 Another major end-user of copper is the United States, which has remained stable at 1.8–1.9 million tonnes of copper demand for the past five years,
As a result of continued economic growth, copper demand in China is also expected to increase by a further 2% in 2024.2
While copper prices remained relatively stable in 2023 compared with 2022, the global market is seeing significant change both in the supply of copper and in demand from key industries. Factors such as grade decline and rising ore hardness are affecting production from existing mines and for various reasons a number of the world’s largest copper producers cut guidance during the year. In China, several factors have created a market in transition in 2023, including a slower than expected post-Covid recovery, with decreased demand from traditional sectors such as property, and emerging demand for sectors linked to decarbonisation.
Chile, Peru and the Democratic Republic of the Congo (DRC) represented a combined total of 46% of the 22 million tonnes of global mined copper supply in 2023, with a further 35–40% coming from the next ten countries, including Australia, the United States, China, Indonesia and Russia.
While Chile is home to six of the world’s top 20 mines by capacity, more than any other country, these mines all commenced operations more than 20 years ago and are mature assets facing issues such as grade decline and increasing ore hardness.
Consensus pricing estimates:
Based on 21 contributing banks, the consensus estimates for copper pricing in 2024 and 2025 are $3.90/lb and $4.00/lb.2 In comparison, the current spot price of copper was $3.84/lb as of December 2023.3