Japan: Copper production falls by 6% on falling demand of semiconductor, automobile

The Japan Copper and Copper Rolling Association has released preliminary data stating that production volume of copper products for financial year, 2022 (FY'22) (April 2022 to March 2023), is anticipated to decrease by 6% compared to FY'21, resulting in a production volume of 725,010 tonnes. However, production in February and March, 2023, were 1% below the demand forecast. It may be noted here that the demand forecast was announced in March.

During first half of financial year, 2022 (H1FY'22), there was consistent demand for automobiles and semiconductor-related products. However, in H2FY'22, demand for products except automotive electronic components was slow.

The production volume for five major copper product varieties amounted to 267,959 t, declining by 4% compared to the previous year. In latter half of the year, demand for automobiles and semiconductors decreased, leading to a 3% decline in copper tube production. This resulted from plumbing inquiries on lower production of air conditioners.

Brass stripe production reduced by 12% to 88,649 t due to reduced demand for stay-at-home products, leading to sluggish consumer connectors and other products. Brass rod production was down by 7% to 166,456 t due to poor sales of housing equipment, which was attributed to excessive inventory.

Additionally, bronze strips decreased by 18% to 24,554 t due to sluggish sales of smartphones and digital home appliances. It is currently uncertain whether there will be any recovery in demand in the next fiscal year.

The association reported that demand for automobiles varies depending on the model. Some models are experiencing strong demand. In contrast, other models are witnessing a weaker demand. Inventory for parts and materials of models with limited sales has not yet depleted. "Overall, it will take a little more time to get to the bottom of the picture," the association stated. Meanwhile, other housing equipment and semiconductor-related products have entered an adjustment phase, and it is uncertain what future holds for them.

Note: This article has been published in accordance with an article exchange agreement between Japan Metal Daily and SteelMint.