Despite the recent slowdown, China's demand is expected to return to growth in 2023. AME forecasts that China’s demand to rise 5.0% to 14,537kt in 2023. This upward trend will continue into the medium to long term but at a slower pace.

China's demand for refined copper is expected to grow at a CAGR of 2.9% to 15,966kt in 2027. This is supported by the continuation of infrastructure investments and robust manufacturing, and by new growth sectors such as EV and battery production, and renewable energies.

China's 14th five-year plan, covering the years 2021 to 2025, highlights high-quality green development and emphasises innovation as the core of modern development. The plan prioritises the “internal cycle”, by which the country aims to strengthen the domestic economy and consolidate social development.

The goal is to cut the reliance on foreign technology and imported resources as quickly as possible and to double down on existing plans for industrial modernisation and technological innovation.

Building new infrastructure has become a top development priority for China, and the plan refers to infrastructure that is ‘digital, smart, and innovative’. The plan for new infrastructure includes seven key areas: 5G networks, industrial internet, inter-city transportation and rail systems, data centres, AI, ultra-high voltage power transmission, and new energy vehicle charging stations.

These plans work in concert with China’s other initiatives, such as Made in China 2025, the country’s seek to become global leaders in high-tech and innovative industries. These plans will boost both China’s economy and its demand for copper.

The State Grid’s total investment in power grid projects during the 14th five-year plan period is expected to reach CNY2.33tn (US$369bn). One primary investment focus will be the development of ultra-high voltage projects, which will cover 24 AC lines and 14 DC lines, involving more than 30,000km of lines, four substations per 1,000km and about four transformers for each substation.

Electric vehicle production is expected to drive China’s copper consumption in the transport sector. China plans to boost sales of new energy vehicles to 20% of new car sales by 2025 and build enough charging stations for the growing NEVs. Tesla, for instance, has planned to expand its Shanghai operations to be the world’s largest automotive export hub. The plan is to produce an additional 450k units of Model 3 and Model Y EVs per year. 

China’s two largest utility companies, State Grid Corp of China and China Southern Power Grid, have invested almost US$1bn in charging infrastructure, and the latter has promised an additional US$3.6bn over the next four years.

Over the long-term, China's refined copper demand is forecast to grow at a moderate CAGR of 1.7% to reach 19,956kt. As China’s economy matures and the country transitions towards a more consumption-driven economy, China's overall demand growth rates will eventually slow. Despite this apparent slowdown, its size will make China the dominant demand driver for the foreseeable future.

Momentum will continue to grow in copper demand given the continued growth in urbanisation and infrastructure, as well as in green energy investments to meet President Xi Jinping's pledge to reach net zero emissions by 2060.

Battery Copper Foil Projects Spring Up

The electrodeposited copper foil market has witnessed impressive growth on the back of fast-growing demand for electric and hybrid vehicles and energy storage.

Tongguan Copper Foil, a subsidiary of Tongling Nonferrous, has unveiled an investment plan of CNY1.345bn (US$199.11m) to build a 15ktpa ultra-thin copper foil plant. The copper foil will be used in the energy storage field. The company plans to complete the construction in 18 months. After the project is completed, Tongguan Copper Foil will have a total capacity of 80ktpa of electronic copper foil.

Tongguan Copper Foil has recently completed construction of the phase 2 copper foil project with a capacity of 20ktpa. The company is also building another 10ktpa copper foil project with an estimated investment of CNY931.84m (US$138.06m). These projects are all located in the Chizhou Economic Development Zone in Anhui Province.

In Jiangxi province, Jiangxi Copper is building a CNY11.4bn (US$1.76bn) 100ktpa copper foil project in two 50ktpa phases. The first 25ktpa line of phase one is due to start up by the end of 2023, with full production expected to be reached in 2024. Phase two is planned for commissioning by the end of 2028.

The copper foil project is one of three projects which were signed between Jiangxi Copper and the local government in July 2021 for a total investment of CNY12.8bn (US$2.0bn). The other two projects are the CNY800m (US$126.1m), 220ktpa copper rod project and the CNY800m (US$126.1m), 30ktpa cast material project. Jiangxi Copper began the construction of these two projects in 2021.

The copper rod project is expected to be completed by the end of 2022. The cast material project will be developed in two phases, with each phase having a capacity of 15ktpa. Phase one is expected to be completed by the end of 2022 and phase two is expected to come online by the end of 2026.

Also in Jiangxi province, Jiayuan Technology has broken ground on its CNY100m (US$14.8m), 15ktpa copper foil project. Meanwhile, Jiayuan Technology will team with CATL to build a high-performance electrolytic copper foil project in Meizhou, Guangdong province, China, with a total annual output of 100ktpa. The project will be developed in two phases with each phase having capacity of 50ktpa. 

In Gansu province, Hailiang Group is building the CNY8.9bn (US$1.4bn), 150ktpa high-performance copper foil project, including 120ktpa capacity for lithium battery and 30ktpa of standard copper foil capacity. The project will be built in three phases. Hailiang has recently completed commissioning of its first production line. Hailiang aims to bring phase two and three online in 2024 and 2025, respectively.

Nuode Investment has started the construction of a copper foil industrial park in Huangshi, Hubei province. At full capacity, the project will produce high-end copper foil for lithium batteries and standard copper foil for 5G circuit boards with a total capacity of 100ktpa, plus other copper-based materials of 200ktpa. The total investment will be CNY12bn (US$1.8bn).

Nuode has also planned to build a 100ktpa copper foil base in Guixi, Jiangxi province. The project will be developed in two phases with each phase having a capacity of 50ktpa.  The first phase is planned to start up in 2023. The second phase is targeted to start construction in 2025.

In 2021, Baiyin Nonferrous approved the cooperative construction of a 200ktpa copper foil project in Gansu province, which will require an estimated total capital investment of CNY12.15bn (US$1.91bn). The 12ktpa first phase started production in October 2019, while the second phase lifted the total capacity to 30ktpa by the end of 2021.

The construction of the 40ktpa third phase started in October 2021 and is planned to be completed by the end of 2022. The project is now planned to be further expanded to 200ktpa by the end of 2025.