Copper end use trends

Mining giants BHP Billiton and Rio Tinto should post record half-year profits as they reap the benefits of an industrial commodities boom, and are likely to use the results to bolster their arguments in a $123 billion (66 billion pound) takeover stand-off. Both are also likely to outline big expansions in key profit sectors such as copper and iron ore, where analysts predict higher prices next year on the back of strong demand for imported raw materials from China's industrial sector. Consenus figures based on forecasts by 20 analysts and provided by BHP point to a 12 percent rise in annual net profit to $15.4 billion, suggesting second-half profit will have risen 30 percent to $9.4 billion from $7.2 billion previously. Analysts polled by Reuters Estimates forecast Rio's January-June underlying profit will have risen 40 percent to $5.2 billion. BHP's financial year ends June 30, while Rio follows the calendar year.

Rio Tinto and General Electric today announced that they are working together on two key strategic technology projects, Rio Tinto's 'Mine of the Future™' and GE's 'Ecomagination'", to develop the most energy efficient and ecologically friendly solutions to support the future of mining.

China imported 87,168 metric tons of the metal last month, the Beijing-based customs office said, citing revised final data. Imports were 88,075 tons in July,

China's Yunnan province will buy 1 million tonnes of base metals to help smelters in the region that are struggling with weak domestic demand and low prices, a report on the Ministry of Land and Resources' website said on Monday.

South Korea-based LS-Nikko Copper, the world's second-largest copper smelter, said on Thursday it would cut copper cathode output by about 10 percent due to weak demand in its first such move in more than four years.

It is clear that the economic and financial downturn have begun to take a serious toll on new wind development.

This evolution made sense at first, because power stations were costlier and less reliable than the grid, so by backing each other up through the grid and melding customers' diverse loads, they could save capacity and achieve reliability. But these assumptions have reversed: central thermal power plants now cost less than the grid, and are so reliable that about 98 percent to 99 percent of all power failures originate in the grid. Thus the original architecture is raising, not lowering, costs and failure rates: cheap and reliable power must now be made at or near customers.

Chinalco Luoyang Copper Co. Ltd., a Chinese high-precision copper plate and strip producer, plans to raise production by 18% y-o-y to 160,000-170,000t in 2011. The expected increase is the result of a capacity expansion through the completion of a 105,000t/y production line. Total capacity now amounts to 210,000t/y, however, production remains suppressed due to ongoing testing at the US$349M new plant in Luoyang City, Central Henan province. In 2010, Chinalco Luoyang Copper Co. Ltd.'s production was 140,000t of copper plate and strip.

Chinese Zhengwei International Group Co. Ltd. has confirmed that it will undertake a 250,000t/y copper wirerod project in Wuwei County of Anhui Province. Another Chinese copper semis producer, Anhui Xinke New Materials Co. Ltd., has announced plans for a 120,000t/y copper wirerod project. The project will take two years to develop at a cost of RMB665.6M.

According to MarketWatch, copper semis fabricators are increasingly looking at supplying niche markets as a result of stagnating demand for more traditional copper semis products and pressure from substitute materials. For example, Luvata, a leading copper semis fabricator, is increasingly focusing on promoting uniquely thin and flexible copper wire utilised in efficient solar panels, as well as, anti-fowling wire for cages utilised by the fishing industry. Other fast growing markets that utilise niche copper semis products include oil and gas exploration, mining and wind generation.

It was reported that a new criterion for the legislative standard which affects copper wirerod fabricators has been approved by a committee of experts and has been submitted to the Ministry of Industry and Information Technology of China for consideration. Industry sources have stated that there is an emphasis on driving domestic innovation to lift the quality and utilisation rates of continuous casting and rolling mill technology, which is currently lagging behind higher performance, expensive foreign equipment. Approximately one third of copper scrap is used in the direct manufacture of copper and copper alloy wirerod and semis. However, it is thought that none of the 80 or so secondary copper rod manufacturers will meet the criteria outlined in the proposal.

Leoni AG announced that it is opening a plant in Jining in northeast China's Shandong province to produce wire harnesses for General Motors Co. and other customers.

It was reported by Antaike that the construction of Anhui Xinke New Materials's copper rod and cable project in Wuhu Jiujiang Industrial Park commenced on 12th December. The construction of the project was commissioned to Wuhu Xinsheng Electric Materials, Xinke's wholly-owned subsidiary. Upon completion, the operation will have a production capacity of 150,000t/y of high quality copper rod and 20,000t/y of special cables.

After over a year of discussions, the final roadmap for the development of the domestic electric vehicle and hybrid vehicle (xEV) industry is likely to be unveiled by the Government in April, just missing the Budget.

Because of slowing housing construction and the consequent decline in demand for gas appliances and water taps, the demand for brass bars in Japan is falling. Demand is also being affected by the decrease in car industry activity. As a result, brass bar makers in Eastern Japan are planning to reduce production output for the fourth quarter by 20-25% on a year-to-year basis. August production in Japan was ''as low as 16,362 tonnes'', according to the Japan Copper & Brass Association. Monthly order receipt volume for the last three months of 2008 is expected to average just 15,000 tonnes.

Kitz Metal Works, a brass bar maker and subsidiary of the Kitz group, announced plans to add a continuous casting line at its Chino plant in Japan. The US$2.6M development will add a further 18,000t-19,200t to the company's annual billet production capacity. Construction work is set to begin this month and the plant is expected to be commissioned by the end of the year. The company expects that the lower production cost of the new casting line will allow for the investment cost to be recovered within five years.

Hitachi Cable Ltd. announced that it will cease production at its Tsuchiura plant by March 2012, effectively ending its domestic copper tube business. The facility produces copper tubes for air conditioners and in FY2010 it contributed to a sales volume of 20,000t; a sales value of ¥17.76B or 4.2% of the company's total revenue. The withdrawal from the business is attributed to difficulty maintaining profitability after air conditioning manufacturers shifted operations to foreign markets. Hitachi will keep a 50-50 JV with Furukawa Electric in Shanghai and its 36% share of a Thailand based copper tube manufacturer.

Upgrades on Eve of Democratic National Convention's 'Greenest Political Convention in History' Held in Denver\n\nDENVER, CO--(Marketwire - August 22, 2008) - Data393, a Managed Data Holdings Company and a leading provider of colocation, managed hosting, disaster recovery and IP network services, announced today the completion of "Green" initiatives to decrease the facility's carbon footprint. The announcement was made in support of the City of Denver's role as host of the 2008 Democratic National Convention, which is touted as the "greenest political convention in history." Data393's Green initiative also follows in the footsteps of the City of Denver's efforts to leave an enduring legacy of sustainability programs in the Denver metro area. \n\nResulting from the expansion of its multi-million-dollar, 30,000-square-foot data center, Data393 has implemented technological advances and infrastructure upgrades at its Englewood data center, just south of Denver, that reduce its environmental impact. \n\n

Recent weakening copper prices does not necessarily mean that copper foil makers will have a potential price revision in the following months, as electricity costs are going to rise in October, said industry players.