Chinas nine major copper prices: plans to cut more than 200 thousand tons of refined copper in 2016 will not lose money

OFweek industrial network: December 19th, Chinas copper raw material (CSPT) group members in Shanghai held quarterly Executives meeting to discuss the refining and metal markets, and evaluation of the progress of the end of 11 agreed to cut. These producers are mostly state-owned enterprises, such as: Jiangxi copper, Tongling nonferrous metals and Jinchuan group.
Reuters quoted a large domestic copper smelting business executives said Saturday that the company, including nine large copper smelters have agreed that the original 350 thousand tons production scale will be the lowest level, if prices fall further, or the spot of imports of refined refining costs (TC/RC) lower than the cost of smelting business, is likely to expand production scale.
Including Jiangxi copper, Tongling nonferrous, China 10 copper smelting enterprises released cut copper production statement, will make 2016 cut production 350 thousand tons, more than the previous Peng Bo reported 200 thousand tons production scale, accounted for 8.75% of the total output of copper China this year.
The production is the background of international copper prices continued to slump. Last week, the London Metal Exchange (LME) copper for the first time in six years fell below $4500 per ton. Chinese economic slowdown to bring great pressure on the price of copper, Chinese is the worlds largest refined copper production and consumption country.
Wall Street informative weekend earlier this week, Bloomberg News Agency reported on Saturday that Chinas copper smelting enterprises consider next year cut. Jiangxi copper and Tongling nonferrous copper enterprises in Shanghai on the same day held a meeting to discuss how to save copper.
Last month pointed out that nine copper enterprises including Jiangxi copper, Tongling nonferrous, preliminary plan on 2016 will be more than 200 thousand tons of refined copper output reached an agreement, equivalent to about 5% of total output this year cut.
Last week, the China Nonferrous Metals Industry Association proposed to the development and Reform Commission, asking the government to buy aluminum, nickel, and cobalt, indium and other rare metals, to digest the excess production.
10 copper smelting enterprises announced production cuts, copper prices slightly higher.
According to Chinas nonferrous net announcement:
In order to actively respond to the current copper industry production and management are facing severe challenges, in response to the national supply side reform call, November 2015 28-30, China copper smelting backbone enterprises (list see Annex) the main person in charge held a meeting, after full discussion, the meeting made a positive response to the enterprises reached a high degree of consensus:
1, the enterprises to actively respond to the national "supply side reforms" appeal, that should consider not only the symptoms but also to consider the cure, not only need to deal with the current difficulties of extreme market required production measures, more should actively take the initiative to eliminate backward production capacity, promote the industry upgrading production capacity.
2, the company reached a consensus on the healthy development of the industry, for the long-term interests of enterprises and industry overall short-term interests, decided to shut down production losses in the short term; in the long term, to avoid other industry overcapacity caused by the loss of the entire industry experience, will further accelerate the elimination of backward production capacity, and decided the next few years longer the expansion of production capacity. At the same time, the relevant departments of the state to stop approval of new copper smelting capacity, increase support for key enterprises, and guide social capital to take equity, holding and other capital means to the industry mergers and acquisitions, and thus maintain the overall stability of domestic copper smelting capacity.
3, the companies agreed that in 2016 will take 350 thousand tons of refined copper production, as well as other necessary measures to maintain the healthy development of the industry.
4, Chinese copper as the serious shortage of resources, the participating enterprises agreed that the current market price has deviated from the industry fundamentals, suggested that the state actively take measures of purchasing and storage.
5, the enterprises agreed to form the industry internal self-discipline and supervision mechanism, supervision of the implementation of the industry, the supply side reform to create a good market environment, to ensure the long-term stable and healthy development of Chinas copper industry.
6, the meeting decided to convene a meeting every half a month to enhance information communication and sharing, and according to market changes, to take further effective measures in time.
7, in order to maintain the market fair environment, protect the interests of investors, the relevant regulatory authorities and the market platform for high-frequency trading and other regulatory and limited.

the 30th November, 2015