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Dow Jones Newswires, 02:38 ET (06:38 GMT) 27-Mar-2012
SINGAPORE (Dow Jones)--The global demand for copper will rise 3.1% in 2012, driven mainly by a 6.8% increase in Chinese demand, a senior official with Xstrata Mining said Tuesday. Speaking at Asia Mining Congress 2012, Xstrata Copper's Chief Operating Officer for North Queensland, Steve De Kruijff said the company sees copper demand holding up well in 2012 as a result of continuing Chinese industrialization. China is the biggest market for copper and many other base metals. Chinese industrialisation "will continue to drive higher rates of copper consumption," Kruijff said. A rise in Chinese copper stocks since the start of the year shouldn't be a cause for concern as those stocks will be used up with consumption rising in the second quarter, he said. "Inventory has been built up in anticipation of strong demand ahead," he said. The second quarter is usually the peak period for Chinese copper demand. At the same time as demand holds firm, supply constraints will hamper production growth, Kruijff said. He estimated global production growth at 5.6% for 2012. Bad weather, labor disputes and long equipment lead time are constraining production growth for copper miners, he said.
