By Reuben Adams
MINOTAUR Exploration stated it was remaining “firmly positive” about the future of copper demand despite the metal falling to six year lows in August.
Mintotaur chairman Derek Carter said that the explorer’s projects in South Australia and Queensland provided “superior discovery exposure to a rising metal price” as existing mines globally drew down on their reserves.
“We remain enthusiastic towards copper as a globally significant commodity, contrary to current price pressure due to softening demand from China,” Mr Carter said.
“Even though ‘grassroots’ exploration continues to be out of favour with many investors our view is that discoveries will reward effort and quality deposits will reward shareholder support in multiples.”
This view was supported by The International Copper Study Group (ICSG), which met in October to discuss key issues affecting the global copper market.
ICSG projections for the remainder of 2015 indicated that the market would remain balanced, while in 2016 a small deficit of about 130,000 metric tonnes would occur as demand outpaced production growth.
“Although a downward revision has been made to global usage in view of lower than anticipated growth in China, larger downward adjustments have been made to production as a result of recent announcements of production cuts,” ICSG stated.
These cuts would be partially offset by higher growth of about 4 per cent in 2016 as additional supply arises from expansions at existing operations, production ramp-up from mines that have recently come on stream and output from new mine projects.
China is responsible for more than 45 per cent of total global copper demand.