19 January 2016

The next four years there is an increase in copper capacity

International Copper Study Group provided data on copper capacity. In accordance with them, the extraction of red metal for 4 years will increase. The volume will be 27 million tons. The growth of indicators relative to 2015 will be 20%. The average annual growth rate will reach 5%. Of these, 84% will be provided through the copper concentrate production sector. Its annual increase is 4.8%, amounting to 21.5 million tons by 2019. The remaining 16% will be provided by the electrolysis and liquid extraction sector. If the annual growth in the segment is 3.5%, by 2019 the volume will be 5.5 million tons. According to ICSG, Peru's share in capacity growth will be 27%.

2015 for the world market of non-ferrous metals has become the worst period since 2008. Copper fell in price for 3 years. Since 1998, this is the longest recession. It was observed against the backdrop of an increase in the supply of copper with a slowdown in consumption by China. Manufacturers have repeatedly announced a decline in production volumes. However, investors continue to be cautious, not hurrying to invest in copper . In the long term, the stimulation of demand for copper will be provided by the PRC. To restore the cost of copper, producers need to reduce the production of metal.

At the Chicago Stock Exchange, the cost of copper for the past six years fell for the first time to 4.4 thousand USD / ton. Such a drop in value was observed against the backdrop of China's poor economic situation. The largest companies have reduced production volumes. However, such a step could not neutralize the surplus metal. In 2011, there was a peak in price growth. He provoked an increase in production and an increase in production, which has not stopped to this day.

In Armenia, copper concentrate in the first half of 2015 became the most significant export item. Rough copper took the 8th place. In general, their exports from the republic amounted to about 27%. Armenia actively exports copper concentrate. Accordingly, this procedure affects the economic growth in income. If the cost of red metal continues to decline, sales will decline. In this case, there will be a negative impact on the budget. The state budget of Armenia provides for the income of 2016 at the level of 1183 billion drams. In 2015, its volume was 1191 billion drams. In fact, this difference points to a reduction of 7 billion drams.

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