Global metal balances in deficit Jan to June 2021

2021-09-07T13:06:17+00:00 September 8th, 2021|Bulletin|

The World Bureau of Metal Statistics (WBMS) has confirmed that the most recent global metal balances report shows that primary aluminium, copper, and nickel metal balances, amongst others, were in deficit during January to June 2021.

Photo by Scott Webb @ Pexels

Image: Scott Webb @ Pexels

In unpacking the latest update on the LME metals balances, the WBMS comments, “The impact of the Covid-19 pandemic has had a dramatic effect on both the supply and demand for metals worldwide. In particular, production and demand were unusually depressed in many countries early in 2020 and so year on year comparisons may appear distorted”.

 Primary aluminium metal balance in deficit in January to June 2021

The WBMS notes, “The calculated market balance for primary aluminium for the period of January to June 2021 was a deficit of 1021 kt which follows a surplus of 1193 kt recorded for the whole of 2020. Demand for primary aluminium for January to June 2021 was 35.47 million tonnes, 3378 kt more than in the comparable period in 2020. Demand is measured on an apparent basis and national lockdowns may have distorted the trade statistics.

Production in January to June 2021 rose by 5.6%. Total reported stocks fell in June to close at the end of the period 496 kt below the December 2020 level.  Total LME stocks (Including off warrant stocks) were 2331.9 kt at the end of June 2021 which compares with 2917.0 kt at the end of 2020. Shanghai stocks rose in the first quarter of the year but fell back in the second quarter ending the period 63 kt above the December 2020 total. No allowance is made in the consumption calculation for large unreported stock changes especially those held in Asia.

Overall, global production rose in January to June 2021 by 5.6% compared with the first half of 2020. Chinese output was estimated at 19635 kt despite slightly lower availability of imported feedstocks and this currently accounts for about 57% of the world production total. Chinese apparent demand was 13% higher than in January to June 2020 and the output of semi-manufactures rose by 11% compared with the production for the same months of 2020. China became a net importer of unwrought aluminium in 2020. During January to June 2021 Chinese net exports of aluminium semi manufactures were 2280 kt which compares with 2101 kt for January to June 2020. Exports of semi manufactures rose by 10% compared with the January to June 2020 total

Japanese demand was up by 103 kt and US demand decreased by 214kt. Global demand rose by 10.5% during January to June 2021 compared with the levels recorded one year previously.

June metal balances for primary aluminium recorded production at 5767.2 kt and demand at 6092.7 kt.”

In a paper referenced on the Statistica.com website, South Africa is currently cited as the largest aluminium producer in Africa having produced some 717,000 metric tons of refined primary aluminium in 2020. However, South African production has decreased in the past decade – production in 2009 amounted to 809,000 metric tons.

Copper metal balance in deficit in January to June 2021

The WBMS notes, “The copper market recorded a deficit of 222 kt in January to June 2021 which follows a deficit of 890 kt in the whole of 2020. Reported stocks (including LME off warrant stocks) at the end of June 2021 were 58 kt higher than at the end of December 2020. Net deliveries into Shanghai warehouses were 79 kt and Comex stocks decreased by 23 kt. Demand is measured on an apparent basis and it is likely that the full effects of national lockdowns will have distorted the trade statistics. No allowance is made in the consumption calculation for unreported stock changes, particularly in the Chinese government stockpile.

World mine production in January to June 2021 was 10.33 million tonnes which was 4.2% higher than the first half of 2020. Global refined production for January to June 2021 was 12.05 million tonnes up 2.4% compared with the previous year with significant increases recorded in China (up 335 kt) and in India (up 66 kt).

Global demand in January to June 2021 was 12.27 million tonnes compared with 11.89 million tonnes for the first six months of 2020. Chinese apparent demand for the period January to June 2021 was 6.93 million tonnes which was 3.5% higher than the comparable period in 2020. Reported output of semi manufactures rose by 8%. US refined copper production was 511.8 kt which was 67 kt higher than the comparable months of 2020.

June metal balances for refined copper recorded production at 2057.8 kt and demand at 2367.9 kt.”

Statistica.com references the Democratic Republic of the Congo as having produced around 1.4 million metric tons of copper in 2020, positioning it as the leading producer country of copper in the African continent. Zambia was the second largest producer of copper in Africa that year at 861,100 metric tons.

Nickel metal balance records deficit in January to June 2021

The WBMS notes, “The nickel market was in deficit during January to June 2021 with apparent demand exceeding production by 41.1 kt. In the whole of 2020, the calculated surplus was 92.7 kt. Reported stocks held in the LME (Including Off warrant stocks) at the end of June 2021 were 27.3 kt lower than at the end of the previous year. Refined production in January to June 2021 totalled 1283.1 kt and demand was 1324.2 kt.

Mine production during January to June 2021 was 1283.8 kt, 193 kt above the comparable 2020 total. Chinese smelter/refinery output rose by 61 kt compared with 2020 and apparent demand was 706.1 kt 138 kt higher than in the previous year. In Indonesia, smelter/refinery production in the first six months of 2021 was 417.9 kt which is 51% higher than in January to June 2020 and demand more than doubled to 184 kt.

World apparent demand was 255 kt higher than the previous year. No allowance is made in the consumption calculation for unreported stock changes. Demand is measured on an apparent basis, and it is likely that the full effects of national lockdowns have not been fully reflected in the trade statistics.

June metal balances for nickel smelter/refinery recorded production at 244.0 kt and demand at 238.4 kt.

Statistica.com references that, the production of nickel metal in South Africa was approximately 34,900 metric tons in 2020 and that South Africa is currently the largest nickel producing country in Africa.

The Covid-19 pandemic continues to impact on supply and demand of metals globally.

Sources:

  1. The World Bureau of Metal Statistics (WBMS) August 2021 statista.com
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