China’s intensity of use of metals will increase as more and more Chinese become ‘urbanised’, according to Scotia Capital analyst Onno Rutten.
Rutten was speaking at the Prospectors and Developers of Canada convention in Toronto, where he forecast per capita consumption of copper could double by 2015, to around 12-14 kg.
At present, China needs around 4 Mt/y of copper, or 26% of world demand of some 17.5 Mt/y.
If intensity of use in China does increase in line with Rutten’s forecast, then Chinese demand by 2015 would be close to 8 Mt, equivalent to almost half current world demand.
Mr Rutten said that India’s demand for copper would also increase significantly. Its current requirement equates to about 2.5% of world demand, but by 2015 this could be 4-5%.
On the supply side, Rutten said global proven and probable reserves of copper were sufficient to last for 28 years at current consumption rates.
But the number of new projects in the development stage was very limited and the project pipeline barely adequate to supply the market.
Copper inventories remain very low and the market will remain volatile for the rest of the year. Scotia Capital is expecting a copper price average of US$2.27/lb for 2007.