Copper will remain as an essential commodity to achieve Prime Minister’s [email protected] vision (make India among the world’s top three economies) and his Net Zero (cut emissions) objectives by 2070. The life cycle of a copper product is longer, and enough scrap is not available to meet the required demand.
Additional smelter capacity is required for the country to become self-sufficient, said Mayur Karmarkar, Managing Director, International Copper Association India (ICAI), a member of Copper Alliance and Indian arm of the International Copper Association Limited.
India’s copper production in FY21 was 363,000 tonnes, import was 150,000 tonnes while export stood at 46,000 tonne. In the previous year, the production was 405,000 tonnes with imports at 142,000 tonnes and exports at 27,000 tonnes. The ‘apparent’ consumption in FY21 was 9,99,000 tonnes against 12,13,000 tonnes in the previous year, according to ICAI data.
“Imported copper comes in different forms. The ore comes from China; the value-added products called copper semis like rod and tubes from South-East Asia. Cathodes are coming from Japan due to the Free Trade Agreement,” Karmarkar told BusinessLine.
Karmarkar said the first job, as an industry and that of the association, is to create visibility for copper. “Today, when you talk with the government about the metal, they will talk only about iron and steel, and aluminium. Copper is not there in the agenda as it is hidden in the end use. However, copper creates the largest value add as a metal and is much more critical for the economy’s growth,” he said.
Once the visibility about copper is there, the government will take the right steps. Visibility is very important. “We are at the flex point for the growth of the commodity be it copper or aluminium,” he said.
Sterlite – a vacuum?
Sterlite’s vacuum is being compensated by import and scrap. The industry adjusts to that by paying more to get copper. There are also issues on quality of the recycled product, and the impact to the environment on bad processes as the industry is very unorganised, he said.
India’s annual growth for the red metal is expected to be around six per cent to support the clean energy transition agenda; and growth in sectors like electric vehicle; infrastructure and housing. These megatrends will need large amounts of copper — right from electrical wires to rods in the air conditioners — with different intensity. There is an urgent need to develop the Indian copper industry and make it more an organised sector, he said.
Government data on copper talks only about refined data from suppliers like Hindalco, Vedanta and Hindustan Copper. This data is much smaller and incomplete without including recycled copper or scrap, which is nearly 40 per cent of the total volume. Of this 40 per cent, 10 per cent is imported scrap and the rest is local scrap. A senior official of The Material Recycling Association of India intends to publish data for recycled metal for copper, steel, aluminium and steel. If they do it, it will be good as there will be better understanding about the overall metal situation, said Karmarkar.
The biggest challenge facing the copper industry is how the unorganised and recycled data gets organised. Government’s recycling policy for all metals — both ferrous and non-ferrous — is to make the recycling industry a visible sector. It will also promote the government’s larger objective of a circular economy. The copper quality from recycling is not that good. Overcoming these challenges will take some time. The government is taking steps to overcome these, he said.
May 30, 2022