Distribution of global copper resources and overseas investment of Chinese companies
Global copper resources pattern
In 2019, global copper reserves were 871 million tons. The copper reserves of Chile, Australia, Peru, Russia, Mexico and the United States together account for 62% of the world's total reserves, which belong to the first echelon of global copper reserves; Indonesia, China, Kazakhstan, Congo (DRC) and Zambia belong to copper reserves. The second echelon accounts for 2-4% of total global reserves.
In recent years, global copper concentrate production has basically maintained at the level of 20 million metal tons, concentrated in Chile, Peru, China, Congo (DRC), the United States and Australia. The top six copper concentrate producers together account for 65.4% of global production. Among them, China's copper concentrate production has rebounded to 1.63 million metal tons year by year since 2016, concentrated in Jiangxi, Yunnan, Heilongjiang, Gansu, Xinjiang and Inner Mongolia. The above six provinces account for more than 67.6% of the total.
In 2019, global copper production was approximately 20.37 million metal tons. Intelligence is the world's largest producer of copper concentrate. In 2019, Chile's copper concentrate output was 5.83 million metal tons, accounting for 28.3% of the global copper concentrate output; followed by Peru and China, with 2.46 million tons of copper concentrate output in 2019. And 1.63 million tons; the top six copper concentrate producers together account for 65.4% of global production, and the production concentration is relatively high.
China is the world's largest importer of copper concentrate, accounting for nearly 50%. The 2019 China Mineral Resources Report shows that China's copper reserves are 114.43 million tons. In addition, China's copper resources are widely distributed, and the resources are relatively concentrated in the northwest and southwest regions. Among them, Tibet, Yunnan, Jiangxi, Xinjiang and Inner Mongolia accounted for more than 60% of the total. In addition, Anhui, Heilongjiang, Gansu, Guangdong and Hubei all have relatively rich copper resources, and the above-mentioned provinces together account for more than 80%.
The characteristics of China's copper resources: there are many medium and small ore deposits, but few large and super-large ore deposits; there are many lean ore deposits but few rich ore deposits; there are many co-associated ore deposits and few single ore deposits. The market share of leading companies such as Minmetals, Chinalco, Zijin, China Molybdenum, Jiangxi Copper, Julong Mining, and Jinchuan has exceeded 50%; in recent years, affected by China’s environmental protection policies, some non-standard high-pollution and high-energy-consuming companies have basically In the state of suspending production for rectification, the possibility of resuming mining is low.
The cost and evolution of global copper concentrate
The cost structure of copper concentrate production is relatively stable, mainly based on labor, electricity and tax costs. The sum of the three accounts for more than half of the production cost of copper concentrate.
In 2019, the 90th quartile of global copper mines is around USD 5,200/ton, and the center of gravity is expected to shift downward in 2020 due to the drop in oil prices. In the cost distribution, Chinese mines above the 90th quartile account for more than 50%, mainly small and medium-sized mines.
The weighted average cost of China's copper mines after deducting by-product income is 27,000 yuan per metal ton. In 2019, the weighted average cost of China's copper mines after deducting by-product income was 27,000 yuan per metal ton, an increase of about 1,200 yuan per ton compared to 2017.
The cost of different regions and enterprises of different sizes are different. The production cost of copper mines in Jilin and Xinjiang is relatively low, while the production cost of copper mines in Anhui and Yunnan-Guizhou is relatively high.
The production cost of copper concentrate in China is on the rise. The reasons are as follows: 1. The mine grade is decreasing year by year, and the mining depth is increasing. 2. The labor cost is rising. 3. Affected by environmental factors, pollutant treatment costs and environmental protection equipment investment increase.
Overseas investment in Chinese copper mines
From 2000 to 2011, the global reserves of copper resources increased from 340 million to 690 million, with a compound growth rate of 6.6%; from 2012 to 2016, as the global investment in exploration decreased year by year, the growth rate of copper reserves slowed down and the global reserves of copper resources From 6.8 to 720 million tons, the compound growth rate was only 1.4%; from 2017 to 2019, the growth rate of global copper reserves accelerated, with a compound growth rate of only 14.9%. The increased reserves were mainly distributed in Mexico, the United States and Chile, while China Then there is a negative growth.
Compared with other countries rich in mineral resources, China's copper resources are seriously inadequate. China's economically recoverable copper reserves have declined since 2016. In 2019, it dropped by 4 million tons from 2012. It is the country with the largest decline in economically recoverable copper reserves in the world.
Over the past decade, China's copper concentrate self-sufficiency has continued to decline, and the imbalance between supply and demand has gradually deepened. In the past ten years, China's copper consumption has maintained rapid growth. In contrast, the slow growth rate of domestic copper mine production has led to a continuous increase in the copper mine market’s external dependence. China’s copper concentrate self-sufficiency has fallen from 40% in 2010 to 22% in 2019.
Benefiting from the high level of TC/RC of copper concentrates in the past few years and the domestic demand to increase the self-sufficiency of electrolytic copper smelting, China's smelting capacity has entered a peak period of commissioning in the past two years. The rapid expansion of copper smelting capacity far exceeds the increase in the supply of copper concentrates, resulting in a shortage of raw materials and a continuous decline in smelting costs.
With the subsequent commissioning of multiple domestic copper mine projects, the domestic copper concentrate supply capacity is expected to increase to 1.83 million metal tons in the next three years, an increase of 14%. However, the increase is still limited, and the imported copper concentrate will still be Chinese copper The main force of concentrate supply.
In recent years, with the continuous improvement of the country’s overall national strength, the “Belt and Road” construction and the acceleration of international production capacity cooperation, my country’s foreign investment policy system has become increasingly complete, and the pace of corporate “going out” investment has accelerated. my country’s overseas mining investment is mainly concentrated in minerals. Countries and regions with abundant resources, political stability, and sound legal systems.
