Aurubis produced 932,000 mt of copper cathode in the 12 months to September 30, up substantially from 889,000 mt in the prior year, the German company said Tuesday.
The company's primary copper business unit reported operating pre-tax earnings of Eur65.4 million （$87.9 million）, up from a loss of Eur27.3 million a year earlier, as a result of higher refining charges and a higher throughput of copper scrap as well as increased sulfuric acid prices.
The concentrate quantities processed in the primary copper unit "were only marginally influenced by the shortage on the concentrate market," Aurubis said, noting that of 2.056 million mt of concentrate was processed at its Hamburg and Pirdop sites during the fiscal year, compared with 2.095 million mt the previous year.
"At the beginning of the fiscal year, the market for copper concentrates was characterised by shortages due to the high demand of Chinese smelters and copper mines' weak production output," Aurubis said in a statement, adding that this led above all to significantly reduced treatment and refining charges on the spot market.
Aurubis said it consumed additional copper scrap in order to keep its primary facilities fully supplied.
"The copper scrap market was well supplied in fiscal year 2009-2010. The continued recovery of the economy and the increasing copper price led to increased copper scrap generation," Aurubis said. "This development was promoted by the great restraint of Chinese purchasers. The supply for our recycling facilities was secured at satisfactory refining charges." A tentative recovery in treatment and refining charges could be observed toward the end of the reporting period, mainly caused by smelter closures and maintenance standstills, the company added.
Aurubis' output of copper products rose notably on the back of growing demand in Europe. Capacity utilisation at the company's four rod plants was high, with a total output of 766,000 mt of wire rod in the 12-month period, up from 622,000 mt in the prior year, while the continuous casting plant in Hamburg producing 210,000 mt of shapes, up from 153,000 mt.
"In line with the overall economic recovery, the trend on the markets for copper products improved more than expected a year ago. This was especially true for the product groups of continuous cast wire rod and shapes," Aurubis said. "In addition, there was a perceptible increase in demand in the markets for semi-finished products, such as strips, sheets and copper tubes." POSITIVE TREND SET TO CONTINUE NEXT YEAR
Looking ahead, "on the copper market, there are signs that the positive trend during 2010 will also continue in 2011," Aurubis said.
This will be primarily supported by the fundamental situation on the market, whereby copper demand will grow further, borne along by the global economic recovery, the company said.
"In light of the expected high copper price, we believe global mining output will pick up further," Aurubis said. "This should lead to improved availability of copper concentrates in the medium term due to newly opened copper mines and thus a recovery of the treatment and refining charges." Higher production output from mines already in operation could help relieve the concentrate markets as well," it added.
"We initially expect recycling materials to remain readily available with good refining charges," the company said, though it added that the situation on the copper scrap markets is "difficult to predict."
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