Japan to See 4.2% Increase in Refined Copper Production Amid Rising Local Demand

Japan is poised for a 4.2% increase in refined copper production during the first half of the 2024/25 financial year, according to Reuters' analysis based on smelter plans. This uptick is largely attributed to a surge in local demand, especially from the semiconductor industry, marking a significant period of growth for the sector.

The forecasted growth follows a challenging period, with Sumitomo Metal Mining (SMM) anticipating a notable 21% increase in output after a two-month maintenance shutdown at its Toyo Smelter & Refinery. This resurgence is seen as a positive sign of recovery and operational efficiency improvements.

Additionally, Pan Pacific Copper (PPC), Japan's leading copper supplier, is expecting a slight boost in its first-half supply. This optimism is due to enhanced output capacity at the Hitachi Refinery in eastern Japan. PPC's unique business model involves outsourcing smelting and refining operations to its parent companies, including JX Metals, Mitsui Mining and Smelting, and Marubeni, while it handles raw material procurement and metal sales. The company aims to overcome previous supply challenges, notably boiler issues at the Saganoseki Smelter and Refinery, to meet the increasing demand.

Supporting this optimistic production outlook, the Japan Copper and Brass Association has projected a 5.9% rise in domestic demand for copper products in the newly commenced financial year. This demand is spurred by anticipated recoveries in the automobile and semiconductor sectors, which are key consumers of copper plates, strips, tubes, and brass bars.

Further affirming the positive trend, the Japan Electric Wire & Cable Makers' Association (JCMA) forecasts a 2.0% growth in domestic copper wire shipments. This growth is supported by a resurgence in the semiconductor industry and robust export demand.