Friday December 16, 2005

Peak Copper

321energy.com, peakoil.com (thread) :

If oil is the most important commodity, then copper cannot be far behind. Being used extensively in electrical power cables, electrical equipment, automobile radiators, cooling/refrigeration tubing, heat exchangers, artillery shell casings, optical fibre, water pipes, drain pipes, plumbing and even jewellery, this reddish-brown metal is a commodity that the world can ill afford to be in short supply of.

But the fact of the matter is that copper is yet another metal that is in a mining deficit that was predicted to be 700,000 tons in 2004 by the USGS 2005 summary. That would be about 5% of the estimated 14.5 million tons produced worldwide. As a result, stockpiles have reduced and prices have increased to over the $2 a pound mark recently. Ross Beaty, the chairman of Pan American Silver and Lumina Copper, recently commented that global copper production was approaching its own version of "Peak Oil" or shall we say "Peak Copper"?

When we look at the comparative reserve numbers for oil and copper we also get a sense of an impending dual peak scenario. Worldwide economic reserves of copper are stated to be 470 million tonnes by the USGS 2005 summary for copper. If the 2004 mine production figure of 14.5 million tonnes is held steady into the future, copper would be exhausted within 33 years. If we also assume about 1 trillion barrels of oil remains to be economically recovered worldwide with a current annual production of 30 billion barrels then we come out with a similar reserve lifetime of 33 years. Coincidence? Not if we realise that increased energy consumption means increased metal consumption. The two go hand in hand.

When might this peak come around? That is probably a little easier to calculate than oil since secrecy about copper reserves is much less prevalent. But the shocking news that Chile, which produces one third of the world's copper, may begin to decline irreversibly in 2008 suggests that as Chile goes, so goes the world. When Chile peaks, the world peaks. Sounds a bit like the peak oil mantra "When Saudi Arabia peaks, the world peaks".

See also :

1. Peak copper

(2005-12-16 10:39:10 SGT) [Env] Permalink

Most popular blog postings on lowem.log :

1. Singapore SIBOR interest rates fall to 1.5%, lowest since Dec 2004
2. 2009 Honda Global Small Hybrid details released : bigger than Jazz/Fit, smaller than Civic
3. Singapore : Inflation rate could push past 6% in Q1 2008
4. Singapore SIBOR rate fell to 1.25% in Apr 2008, lowest since Aug 2004
5. Fuel prices seen stoking Malaysia inflation in 2008
6. Singapore CPI inflation rate for May 2008 continues at 26-year high of 7.5%
7. Singapore CPI inflation hits 6.6% in Jan 2008 - a new 25-year record high
8. Singapore SIBOR rate falls to 1.31%, lowest since Nov 2004

Featured articles on lowem.log :

1. ABC Guide to Beating Inflation in Singapore and Elsewhere
2. Singapore inflation rate hits new 26-year high of 7.5% in Apr 2008
3. Hyper-inflation : early warning signs
4. Singapore hyperinflation warning signs #2 : Cooking oil price up 75%
5. Bread and inflation
6. Singapore M3 money supply growth vs STI stock index
7. Singapore SIBOR rate fell to 1.25% in Apr 2008, lowest since Aug 2004
8. Singapore : Inflation erodes away bank savings