Copper needs three quarters of pipeline to go into production

A 10 million-tonne copper supply gap is forecast to open up through 2035
12th April 2019
Resources Rising Stars

A 10 million-tonne copper supply gap is forecast to open up through 2035, CRU senior analyst Hamish Sampson has told the World Copper Conference during a session examining factors determining the long-term outlook for copper and the copper price (reports MiningNews).

"[Brownfield] expansions will keep pace with demand until early next decade ... but as demand increases to 22.5Mt by 2025 the gap will be 2.5Mt and then it will quadruple as production from existing operations falls to 15Mt," he said. Last year copper production was 20.9Mt.

Sampson said many operations would deplete reserves over the next 10-20 years, although some would find ways to extend their mine life such as the Radamiro Tomic mine of Chile's state copper company Codelco, and Rio Tinto's Bingham Canyon that was exploring options to expand the openpit and develop a block cave.

"As it currently stands, we have 225 operations that accounted for 40% of production last year that will reach the end of their mine life by 2025. 75% of uncommitted projects are needed to fill the supply gap by 2035 compared to 90% this time last year," Sampson said.

He said most of the projects in the industry pipeline were uncommitted projects with a lot of uncertainty hanging over them. "It can take up to a decade to clear feasibility and development stages. The pipeline has the potential to swing the market in either direction," he said.

Most supply growth would come from Latin America, which hosts 43% of projects in the pipeline representing some 11.6Mt of potential production of the 25Mt in the global pipeline. "There are 130 active projects in South America with average annual output of 80,000t and an average 22-year mine life," he said.


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