LONDON: China’s net imports of refined copper surged by 38% to 4.4 million tonnes last year, breaking all historical records.

The country’s call on metal from the rest of the world was a million tonnes higher than the previous peak in 2018 and 1.2 million tonnes more than was imported in 2019.

This extraordinary buying spree has propelled the London Metal Exchange (LME) copper price from its COVID-19 low of $4,371 per tonne in March last year to above $10,000 per tonne, last trading at $9,985.

It has also reshaped the copper market’s statistical landscape, judging by the latest forecasts from the International Copper Study Group (ICSG).

The Group suggests the global market will record modest supply surpluses of 79,000 tonnes and 109,000 tonnes this year and next respectively.

If that seems a bit at odds with the bullish exuberance currently washing around the copper market, it’s because of what happened last year.

China sucked so much metal out of the global market-place that copper recorded a deep 600,000-tonne statistical supply-demand deficit, according to the ICSG. That black hole looms large over the Group’s outlook. However, Chinese imports are now slowing and the big question is what happens when the big copper driver stops driving.

Copper usage outside of China collapsed by 9% last year with pandemic lockdowns having “a notable negative impact on the world economy and subsequently on key copper end-use sectors in all regions,” the ICSG said in its latest twice-yearly assessment of the market.

Such a demand implosion should have resulted in a massive surplus of unsold metal and a big rise in inventories. That didn’t happen, however, thanks to China removing a record 4.7 million tonnes of metal from the international market with only a trickle of offset from exports. This import strength radically affects calculations of global market balance.

Calculating usage in the copper market is challenging because copper is continuously being melted into different forms for myriad end-products. The statistical problems are compounded when it comes to working out what is happening in China’s massive, geographically dispersed manufacturing sector.