Cu2 Consulting expects global demand for copper & alloy semis to grow +4.1% y-o-y in 2021

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Cu2 Consulting expects global demand for copper & alloy semis to grow +4.1% y-o-y in 2021, recovering from the drops recorded in the previous two years. Yet, the average rates mask significant differences at the country level. By product types, rolled products and brass rods are expected to record the highest growth rates this year


Last year, affected by the pandemic, global demand for the main copper and copper alloy semis (copper wire rod, copper tubes, rolled products, brass rods, and copper bars) contracted by -2.7% y-o-y, following another drop of -1.0% recorded in 2019.


The global average decline of 2020 was tempered by trends in China. Excluding China and Taiwan, global demand recorded a drop of -6.7% y-o-y in 2020, rather evenly distributed across the different continents: -7.6% in North & Central America, -6.8% in Europe, -5.0% in South America, -6.3% in the rest of Asia, -8.6% in Africa, and -7.2% in Australasia.


According to Cu2 Consulting estimates, demand for copper semis increased sharply in the first six months of 2021, recording double-digit growth rates in almost all continents, with an average y-o-y increase of +14.5% worldwide. However, the magnitude of the increase is amplified by the comparison with the poor performance registered during the first half of 2020 (especially in the second quarter).


Looking ahead, Cu2 Consulting expects global demand for the main copper and copper alloy semis (copper wire rod, copper tubes, rolled products, brass rods, and copper bars) to grow by +4.6% at the year level in 2021, to more than 29.8 million tons, corresponding to +1.3 million tons compared to 2020 and +532,500 tons above 2019; therefore, more than offsetting the decline suffered over the past two years.


Below is a brief reference to our forecasts for 2021 by continent and for the 15 world’s largest countries in terms of demand, namely those with total demand for copper semis (defined as specified above) higher than 300,000 tons per year.


Asia: Demand is expected to grow by +3.0% in 2021 (to ~20.8 million tons), with China’s demand increasing by +2.5% (the country had nevertheless recorded growth in 2020). Among the other largest outlets, the most dynamics are expected to be India (+7.2%) and Taiwan (+6.3%), the latter continuing to progress despite the good developments recorded in 2020. The other four Asian countries with total demand above 300,000 tons are all forecasted to register lower growth rates, between +2.5% and +4.4%.


Lastly, suspended between Asia and Europe, Turkey will be one of the brightest spots among the largest countries, with demand for copper semis expected to increase by +11.5% in 2021.


Europe (geographic Europe, including Russia, Ukraine and the other Eastern European countries): Demand is expected to grow by +9.9% this year (to ~5.0 million tons). Considering the four countries with the annual demand for semis higher than 300,000 tons, Germany and Italy are expected to record double-digit increases of around +14.0%, while Russia and Spain are forecasted to grow by +6/+7%.


North & Central America: Demand for copper semis is expected to grow by +8.1% in 2021 (to ~2.9 million tons). The average growth rate is rather evenly distributed across major markets in the region.


South America: According to our forecasts, demand for copper semis will increase by +6.2% this year (to ~0.6 million tons), with the largest regional market, Brazil, expected to grow by 5.6% y-o-y.


Demand is anticipated to grow to a significantly lesser extent this year in Africa (+0.5%) and Australasia (+1.8%).


A last geographical mention to three sub-regions, the Asean, the Middle East, and North Africa, which will all record a weak performance this year according to the forecasts of Cu2 Consulting.


The first, Asean, is anticipated to grow by only +1.3% in 2021, since the expected declines in certain large markets negatively affected by the pandemic – such as Indonesia and Malaysia – will almost completely offset growth in other regional markets.


The other two sub-regions, the Middle East and North Africa, are even anticipated to contract their demand for copper semis this year; the first – the Middle East – due to the negative performance in almost all markets except Israel and Kuwait, while the North Africa average will be the result of demand contraction in Egypt and growing demand in Tunisia and Algeria.


Finally, a brief mention of our 2021 forecasts at the global level by major copper products.


We anticipate brilliant growth for brass rods and rolled products (both expected to grow by around +8.0% worldwide), with a more moderate, yet good, improvement for copper tubes, bars and wire rods, for which we foresee demand to increase between +3.0% and +5.0% y-o-y.


The above is just a brief summary of the many interesting findings from our last review of the Cu2Dem Report, which was updated at the end of October. Cu2Dem is a quarterly service including Cu2 Consulting’s assessment of copper semis demand for all main copper semis in all countries and regions of the world. Time series include the last two years, quarterly data for the current year, and annual forecast from 2021 to 2025.


Cu2Dem service can also be subscribed by single module(s) (by geography and/or product) according to the needs of individual companies. Annual subscriptions include four quarterly deliveries, each with quarterly updates of all data. Discounted rates are offered for subscriptions to multiple modules.


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