Italy 2011 nonferrous industry growth slows

Reuters reported that Italy's output of nonferrous metals semi-finished products is expected to rise this year driven mostly by export demand, but at a slower pace than in 2010.

Mr Claudio De Cani director of Italy's industry body Assomet said that output of copper and alloy semi finished products by the Italian industry, the second-biggest in Europe, is expected to rise to 1.150 million tonne to 1.200 million tonnes this year from 1.111 million tonnes in 2010.

Mr De Cani said that output of aluminum and alloy semi finished products is seen rising to 900,000 tonnes to 920,000 tonnes from 846,000 tonnes in 2010. The copper and alloy industry's expected growth of 4% to 8% and the 6% to 9% rise forecast for the aluminum sector in 2011 is a far cry from the 19% and 25% respective jumps in 2010 when Italy's nonferrous metals industry started recovering from the global economic crisis.

He said that construction demand, which is very important for the sector has not seen a great recovery. Access to credit is still very limited for construction companies and for people. Construction demand accounts for about 20% of total copper and alloy semi finished products demand and varies from 15% for rolled aluminum products such as sheets and coils to 45% for extruded aluminum products including bars.

Mr De Cani said that demand for non-ferrous metals products from automotive mechanical and other industries has been more active this year than construction demand and has been driven largely by export demand from Germany, France and Britain.

According to preliminary Assomet data, in the Q1 of 2011, Italy's copper and alloy semi finished product output rose 1.3% YoY to about 294,000 tonnes. It is very little if we want to recover the levels of 2007. And orders are rather sluggish. Output of aluminum and alloy semi finished products jumped 12.3% to nearly 230,000 tonnes in the first three months of 2011.

Mr De Cani said that volatile copper prices which rose at the start of this year but now are on track for a third monthly loss have created great uncertainty among consumers prompting them to hold off new orders. There are so many forecasts around that copper prices would fall that people prefer to postpone buying. But such decisions cannot be postponed for ever, and there are signs of stock rebuilding.

He said that a lot of market operators have been waiting for signals that China, a major consumer of industrial metals, started buying copper which would mean the end of price falls to resume metal purchases.