BNP Paribas Trims 2011 Copper-Deficit Estimate To 300,000 Metric Tons

BNP Paribas Trims 2011 Copper-Deficit Estimate To 300,000 Metric Tons

BNP Paribas has cut its estimate of the 2011 underlying deficit in the copper market to 300,000 metric tons from the previous 500,000. BNP then looks for the copper market to be “barely balanced” in 2012 and says “any surplus in 2013 will be modest.” With emerging nations now accounting for nearly 70% of first-use demand, BNP says it looks for world copper consumption to remain on an upward path. “We have trimmed our forecasts of growth by a further half percentage point to around 4% for both 2011 and 2012, comprising about 6% in emerging countries and flat demand in developed nations,” says a report from senior metals strategist Stephen Briggs. At the same time, BNP has slightly upped its estimate of world refined production this year. “The industry could raise refined output by as much as 4% in 2011, chiefly due to smelters running down concentrate stocks accumulated last year,” BNP says. “But given widespread poor performance and current labor unrest in Indonesia and Peru, growth in global mine production may yet fall short of even the feeble 1.5% we currently forecast.” BNP says its view of the market balance this year remains at odds with the trend in visible stocks, which have risen. The bank says the explanation lies in China running down its stockpile that was built up in the fourth quarter of 2008 and 2009-2010.