Copper Industry Facing Imports Onslaught

Hindustan Coppers current mine expansion plan has been increased from 12.4 to 20 million tons per year in the next six years

One of the major challenges that the domestic copper industry is facing is a huge surge in imports of refined copper from the countries that India has forged free trade agreements with. Imports have increased from 65,000 tons in 2010-11 to around 2.50 lakh tons in 2017-18, which is equivalent to one third of the total domestic demand. It may be mentioned that India has FTAs with Malaysia, Japan, South Korea, Chile and various other neighbouring countries.

Based on investments in upcoming infrastructure projects and increased government spending on housing, rural and railway electrification, refined copper demand will grow at a very rapid rate in the coming years, as per Santosh Sharma, Chairman and Managing Director, Hindustan Copper Limited (HCL). Sharma, speaking at the copper major’s 51st annual general meeting (AGM) in Kolkata recently, said the growth rate of domestic copper consumption is likely to increase by 6-7 percent in the year 2018.

Refined copper production during fiscal year 2017-18 (FY18) of the country was at 8.43 lakh tons as compared to 7.98 lakh tons in FY17. With regard to consumption, Sharma said it is estimated that during 201718, the consumption of refined copper was around 6.6 lakh tons compared to 6.5 lakh tons in 2016-17.

Global perspective

During the year 2017, world refined copper production was at 23.5 million tons, registering a growth of 0.7 percent. In 2018, production of refined copper is estimated to grow by 5 percent to a level of 24.5 million tons.

As per the International Copper Study Group (ICSG), world mine production decreased by 1.5 percent in 2017 but is expected to grow by around 3 percent in 2018 to a level of 20.67 million tons.

With regard to the global demand for refined copper, sustained growth in demand is expected to continue because copper is essential to economic activity, Sharma said.