The copper market - France (2024)

1.2 A fast-growing global copper market dominated by China and Chile

According to GlobalData, Chile is the world's largest copper producer in ****, with production down *.**% on ****. Over the previous five years to ****, Chilean production grew at a CAGR of *.**% and is expected to increase at a CAGR of *% between **** and ****. Chile accounts for **% of world production, the other largest producers being Peru, China, the Democratic Republic of Congo and the USA. Chile's copper exports fell by *.**% in **** compared with ****, with the highest share exported to China. Chilean copper exports are expected to grow at a CAGR of *% between **** and ****. On the refining side, China holds a dominant share, approaching **%, of global copper refining. In geostrategic terms, it is consolidating its position by securing resources through direct foreign investment in Latin America, Asia and Africa[***]. Although Chilean copper is not a major customer for France, since its manufacturing output is almost exclusively recycling, Chilean copper is present everywhere in France's imports of processed copper.

World copper market World, ****-****, in billions of USD Source: ****

The global copper metallurgy market has a bright future ahead of it, with an estimated CAGR of *.**% and a size approaching *** billion dollars by ****.

Distribution of tonnages of semi-finished copper products worldwide World, ****, as % of total Source: ****

The breakdown ...

1.3 A slight dip in the French market that should not last

NAF code **.**Z covers companies in the copper metallurgy sector. This NAF code includes the following activities

copper production (***) production of copper alloys production of copper sheets, foils, rods, wires, profiles, pipes, etc production of copper tubes

Copper metallurgy market France, ****, in millions of euros Source: ****

Sales data for the copper metallurgy industry in France from **** to **** reveal a fluctuating trend, with highs and lows throughout the period. In ****, sales reached *** million euros, showing a decline on the previous year despite a slight increase on ****. This decrease can be attributed to excess production on the market, illustrating possible overcapacity or insufficient demand.

The year **** was in fact characterized by surpluses linked to the slowdown in manufacturing production, leading to massive destocking and a reduction in demand for primary metals. As a result, the London Metal Exchange index has fallen by *. *% since the beginning of the year.

Despite the downturn in ****, copper prices are expected to rise in the medium to long term. Analysts point out that copper is benefiting from both short- and long-term catalysts, with growing demand in power grids and data centers, due to the development of artificial intelligence[***].

Against this backdrop, the outlook for **** is somewhat cautious. The ...

1.4 A resolutely negative trade balance

French trade balance (***) France, ****-****, in $ millions Source: ****

The chart reveals an upward trend in French exports of copper and its derivatives until ****, peaking at $*,*** million in that year, before declining slightly in **** to $*,*** million. At the same time, imports rise steadily from $*,*** million in **** to $*,*** million in ****, leading to a consistently negative trade balance, reaching -$*** million in ****.

Exports

Main countries of destination for French copper exports World, ****, in Source: ****

Germany, Italy and Belgium stand out as the main destinations, accounting for **%, **% and **% of total exports respectively. However, a significant **% of exports are also directed to other countries, underlining the diversification of markets for French copper. Exports to China, although less significant in percentage terms, remain a factor to be monitored, given its major role in the world economy.

Imports

Main countries of origin of French copper imports World, ****, in Source: ****

Germany dominates as the main supplier, accounting for **% of total imports, followed byItaly with **% and Chile with **%. While this distribution may indicate a diversity of supply sources, heavy dependence on certain countries, such as Germany, may present risks in terms of security of supply and price volatility.

2.1 Typology of demand

Demand for copper revolves around several major areas of application, both domestic and non-domestic.

Copper consumption by sector World, ****, in Source: ****

In order of importance:

The consumer goods sector (***) Construction (***) Transmission and telecommunications (***) The industrial sector Transportation (***)

2.2 Demand for copper in the plumbing sector

The piping and fittings market holds up well, despite unfavorable macroeconomic conditions

Copper pipes are widely used in piping applications, thanks to their malleability and durability in the face of corrosion, heat and impact. They come in two types: unbleached copper, ideal for flush-mounting, and annealed copper, requiring visible fastenings. The choice between the two depends on the specific needs of the project.

The plumbing market has extremely low elasticity to most macroeconomic variations: in times of Covid-**, business never collapsed, and even stabilized, as everyone stayed at home and there were no variations in demand linked to vacation departures.

Trend in the size of the national plumbing installation/maintenance market France, ****, € billion Source: ****

With an increase in market size of over €*** million between **** and ****, the plumbing market appears to be booming. However, there are a number of factors behind an expected slowdown in performance from January **** onwards. Therise in interest rates and the tightening of mortgage conditions have added a constraint to households, which will be less likely to want to buy a home in the coming months. The **-year usury rate has risen to *.*%, from below *.*% at the end of ****.

There is also fierce competition from seconded workers and ...

2.3 Demand for copper cables and wires in telecommunications

A driving force in copper demand

Size of the wire and cable and electrical installation equipment manufacturing market (***) France, ****, € billion Source: ****

The size of the wire & cable and electrical installation equipment manufacturing market in France grew steadily until ****, peaking at €*.*** billion. However, a slight decline is observed in ****, followed by a sharp rise in **** and ****. In ****, although the figure is slightly down on the previous year, it remains high, signalling a trend towards market stability.

Wireline telecommunications market size (***) France, ****, € billion Source: ****

The wireline telecommunications market in France has remained relatively stable over the period under review, with only minor variations from one year to the next. Although sales fluctuated slightly, they remained close to ** billion euros in ****, indicating a certain resilience despite economic and technological fluctuations.

Orange's dismantling of the copper network and the advent of fiber

Today, **% of the French population has access to fiber optics, and more than half have already taken out a subscription. Orange, which owns the historic telecommunications network, plans to phase out the copper network nationwide by **** [***].

distribution of fixed broadband access technologies across all subscriptions in OECD countries. OECD countries, ****, as % of total subscriptions Source: ****

Recent OECD data highlight the strong growth of ...

2.4 The growing use of copper in electric vehicles

Copper is attracting growing interest as an essential material in the context of the energy transition. Indeed, the use of copper in low-carbon technologies, mainly in the energy and transport sectors, is greater than in more traditional energies.

Approximate mass of copper present per type of passenger car France, ****, in Kg copper/vehicle Source: ****

The TIAM-IFPEN model was used to project future copper demand up to ****, based on two climate scenarios: one with a temperature rise of *°C (***)" mobility, while the second promotes sustainable mobility.

The results show a sharp rise in annual copper demand, from ** million tonnes in **** to ** Mt and *** Mt respectively for the *D and *D scenarios by ****, taking into account the BAU mobility scenario. This demand is mainly driven by the power grid, consumer goods and transportation sectors.

In all scenarios, the global fleet of electrified vehicles grows significantly, particularly in the more ambitious climate scenarios.

Both battery electric vehicles (***) are considered here.

number of electric cars sold in France France, **** - ****, in thousands of vehicles Source: ****

In view of the much higher concentration of copper in electric and hybrid vehicles, a sharp increase in copper demand seems inevitable in the short term, even if theiFPEN forecasts ...

2.5 The benefits of copper in electronics

Copper is widely used in electronics for a variety of applications, including:

Printed circuit boards for electronic devices such as cell phones, computers and medical equipment. Electrical connections in electronic components such as transistors, capacitors and coils. Manufacture of cables and wires to carry electricity in electrical circuits and systems. High thermal conductivity for cooling high-power electronic components.

...found mainly in these consumer products:

Cell phones and smartphones Laptops and desktops Tablets Televisions and screens Household appliances such as refrigerators, dishwashers and washing machines audio and video equipment Medical equipment such as scanners and MRIs Electronic measuring and control instruments

Consumer electronics equipment rate France, ****, in Source: ****

The consumer electronics equipment rate in France has evolved significantly in recent years. Smartphones and connected speakers in particular have seen a sharp increase, rising from **% to **% between **** and **** and from *% in **** to **% in **** respectively, and far outstripping other devices. This reflects the growing trend towards connectivity and mobility, as well as the rise of digital services and applications. However, despite the growing popularity of smartphones, traditional cell phones and landlines appear to be maintaining a stable presence, while tablet use appears to be growing, but at a slower pace than that of ...

2.6 European copper demand at the heart of the technological and energy shift to 2050

Europe's energy transition will be the main driver of growth in most base metal and silicon markets, which already include widespread uses.Aluminum and copper are widely used in the energy transition. By ****, Europe will require a new demand equivalent to **-**% of current consumption levels for the manufacture of electric vehicles, power grids, batteries, batteries, batteries, batteries, batteries and batteries.batteries, wind turbines and solar panels (***)[***].

Development of copper requirements in Europe to **** Europe, ****, in Mt Source: ****

The main uses for copper in future energy transistion will be in electric vehicles, power grids and wind power.

Recycling to meet future energy needs

Europe will have to make decisions on how to meet its growing demand for metals, in order to guarantee both its strategic autonomy and its environmental leadership. In the early years of the energy transition, Europe will mainly need a new supply of primary metals from mining and refining, to reach the **** baseline. These needs can be met by a combination of domestic production capacity and imports.

Secondary supply from recycled sources will play a more important role as current clean energy technologies begin to reach their end-of-life. After ****, recycling could be Europe's main source of supply for ...

3.1 Value chain

3.2 Companies and workforce: a market down to a handful of players

Growth in the number of companies in the copper metallurgy sector France, **** - **** Source: ****

Between **** and ****, the number of companies in the copper metallurgy sector in France fell significantly, from ** in **** to ** in ****, a drop of **.*%. This downward trend could indicate difficulties or structural changes in the industry. At the same time, headcount has also fallen over the years, from *,*** in **** to *,*** in ****, a decrease of *** employees, representing a decline of almost **%. These figures suggest a reduction in production capacity and perhaps a rationalization of operations within the remaining companies.

There is also a trend towards concentration, with a few major players coming out on top, such as Nexans, the world's *nd largest producer of copper cables, which has almost multiplied its sales by **% between **** and ****.

Foundries are concentrated in eastern France, close to the European market. It should be noted that some copper foundries are not registered under NAF code **.**Z "Copper metallurgy", due to their sometimes more important ancillary activities.

3.3 The essential role of traders in copper supply

Despite the importance of copper recycling in the French copper metallurgy process, traders are key partners for smelters.

Copper traders play a vital role in the entire supply chain for the red metal. Their primary mission is to optimize the flow of copper concentrates, while seeking to reduce the costs associated with the smelting process in foundries. Acting as intermediaries between mining companies and smelters, they ensure that raw materials are of high quality and profitable, while guaranteeing financial stability through their capital contribution.

The price of copper concentrates is established in a unique way: mining companies and smelters around the world negotiate this price in the last quarter of each calendar year, and it becomes the benchmark for the following year.

Growing demand for copper, particularly in the context of the current energy transition, is stimulating competition between market players, encouraging new entrants to position themselves. Traders also provide financing solutions to mining companies, enabling them to acquire equipment and increase their production capacity. Their involvement in markets such as the London Metal Exchange helps to structure copper financing, where price configuration can have an impact on financing, particularly in the case of contango, where the cost of financing the ...

4.1 Offer typology

Which alloys for which applications?

Source: ****

Typology of copper by-products on offer

4.2 Rising copper prices: the clear cause of current copper price trends

Production price index for copper metallurgy France, **** Source: ****

The Producer Price Index for copper metallurgy in France showed a steady upward trend from January **** to September ****, rising from ***.* to ***.*. It then fell slightly until January ****, before rising again to ***.* in September ****. This overall upward trend suggests an increase in production prices in the copper metallurgy sector over the period under review.

Copper prices

Copper prices World, ****, in $ Source: ****

Copper prices reached their highest levels since **** this morning in London, moving just above $*,***/tonne for three-month delivery. Investors flocked to the commodity, anticipating a recovery in demand and lower rates in the months ahead. This trend comes against a backdrop of signs of economic recovery, notably in China, where purchases by investment funds have also propelled aluminum to a level not seen since February **** and zinc to a one-year high. Dan Smith, Head of Research for Amalgamated Metal Trading, underlines the optimism about future economic growth, based in part on Chinese manufacturing index data showing an accelerated pace of growth in March, thanks in particular to domestic and foreign orders[***].

4.3 A potentially infinite supply of copper?

Copper: an infinitely recyclable material

Copper is a material renowned for being infinitely recyclable without altering its physical and electrical properties, offering a sustainable alternative to primary production. In France, two main processes are used to incorporate recycled copper raw materials (***): refining and smelting recycling. The former is little developed in France, while the latter is more widespread, involving the smelting of pre-consumer scrap to produce semi-finished copper products. This approach to recycling helps to reduce the copper industry's environmental footprint, while creating opportunities for the production of high value-added alloys[***].

France lags behind in refining and smelting by incorporating copper PRMs

However, the copper recycling process requires considerable financial investment, which can discourage purely financial investors due to high working capital and cash flow requirements[***].

Historically, cable manufacturers have developed sorting techniques for pre- and post-consumer waste. Their foundries are equipped to purify copper by removing traces of polymers and heavy metals. However, these manufacturers currently integrate little post-consumer PRM, limiting themselves to pre-consumer waste such as their internal offcuts and manufacturing waste from their downstream channels.

Copper tonnages at each stage of the value chain France, ****/****, in kilotonnes Source: ****

In France, although large volumes of copper WPM are collected, ...

5.1 Regulatory framework: safety standards

REACH regulations

The use of refined copper and its by-products in the manufacture of copper and copper alloy products is covered by the REACH registration process. It is important to note that copper and copper alloy products are not defined as a substance or mixture under Regulation (***). Thus, in accordance with Article ** of the REACH regulation, it is not necessary to compile a safety data sheet for these products[***].

List of SVHC alarming substances

Copper and copper alloy products with a lead content ≤ *.*% by weight and packaging do not contain any of the substances of particular concern(***) mentioned on the SVHC candidate list for authorization in concentrations above *.*% by weight. Notification toECHA 's SCIP database is therefore not applicable [***].

European Commission Regulation n°****/****

Classification of substance or mixture :

Principal adverse physicochemical effects on human health and the environment : Spillage and extinguishing water may cause pollution of watercourses.

labeling information according to Regulation (***) :

Signal words: Danger Pictograms: GHS**, GHS** Hazard statements: H***, H*** Precautionary statements - prevention: Keep away from heat, hot surfaces, sparks, naked flames and all other sources of ignition. avoid release into the environment.

Other hazards: Dust hazard.

Endocrine disrupting properties: Does not contain endocrine disruptors at concentrations ≥ *.*%[***].

5.2 Legislation and draft legislation on copper recycling

Regulation of July **, ****

The European Union has established quality and processing criteria to enable copper scrap to no longer be considered as waste. These criteria are defined in a regulation published on July **. To be removed from waste status, copper scrap must meet specific quality and treatment criteria, notably limiting the presence of foreign bodies and soiling. The producer must provide a certificate of conformity for each shipment of copper scrap, and implement a quality management system. The aim of the regulation is to encourage the direct use of copper scrap in foundries and steelworks, after initial sorting and treatment[***].

"Ecodesign for Sustainable Products Regulation - ESPR

The European Commission has proposed the Ecodesign for Sustainable Products Regulation (***) in line with the Green Pact for Europe. This proposal aims to make products on the EU market more sustainable, repairable and recyclable, thus contributing to the transition to a circular economy. It extends the current framework of the Ecodesign Directive to cover a wider range of products. The REPD 's ambitions include designing more sustainable and circular products,supporting informed choices through digital passports, reducing waste from unsold products and promoting sustainable products via mandatory criteria for public procurement[***].

"Waste ...

5.3 The problem of legislation on the use of copper in agricultural activities

The renewal of European approval for copper compounds, effective January *, ****, introduced a limit of ** kg of copper per hectare over a *-year period, regardless of intended use. This rule allows an annual average of * kg of copper/ha at the request of the marketer and subject to a favorable assessment by Anses. Marketing authorizations (***) will be re-evaluated by **** according to these new conditions.

Anses has already incorporated this limitation into some older AMMs which did not initially include it, while other AMMs already provided for an annual restriction of * kg per hectare.

What's more, the recent amendment to European regulations on organic farming eliminated the possibility of smoothing over a *-year period for perennial crops, bringing the conditions for the use of organic products down to a minimum.this brings the conditions for using copper in organic farming down to the same standards as those for conventional farming, as set out in the MAs[***].

Where does the problem come from?

Copper plays an essential role in the fight against a wide variety of fungal and bacterial diseases, often representing the only solution available. In organic farming in particular, copper compounds are widely used to treat diseases such as grapevine downy mildew, ...

6.1 Positioning the players

Here is an almost exhaustive list of French copper smelters:

• BHP Billiton
• Aurubis (Richmond)
• Nexans groupe
• Silec Cable (groupe Prysmian)
• Reynolds Cuivre France
• Prysmian Group
• Lebronze alloys
• Nyrstar