India is on track for another year of strong copper demand, following a 16% increase in FY23. According to Mayur Karmarkar, Managing Director of the International Copper Association India (ICA), the country’s copper demand is expected to see double-digit growth in FY24, significantly outpacing the global growth forecast of around 3%. This surge is fueled by substantial investments in infrastructure, electric vehicles (EVs), clean technology, and consumer durables. Copper’s widespread industrial application makes its price a key indicator of global economic health.
In a recent conversation, Karmarkar shared insights into India’s evolving copper demand, the nation’s shift from a net exporter to a net importer, and the potential impact of new smelters on the domestic market. Through November 2023, copper cathode demand in India reached nearly 81.2% of the previous financial year’s total, with imports of copper cathode, scrap, and wire rods experiencing significant increases.
Despite global economic uncertainties, India’s focus on infrastructure development and the clean energy transition, along with rising consumer spending, are expected to drive copper demand. Currently, India’s per capita copper usage stands at 1 kg, considerably lower than the global average of 3.2 kg. However, projections suggest this figure could align with the global average by 2047.
The country’s copper production has not kept pace with its growing demand, leading to increased reliance on imports. The closure of the Sterlite copper smelter in Tuticorin marked a pivotal moment in India’s copper industry, shifting the balance towards imports. However, the anticipated start of production at the Adani smelter in 2024 and potential resolutions for Sterlite’s legal challenges could significantly alter the landscape, potentially restoring India’s status as a net exporter.
On the mining front, Vedanta has reclaimed control over Konkola Copper Mines, highlighting a successful resolution with the Zambian government. This move, alongside other Indian companies exploring overseas acquisitions, underscores the strategic efforts to secure copper resources amidst global competition.