Italy copper and alloy product output seen down

Business Recorder reported that output of copper and aluminium semi finished products in Italy, a major European producer is expected to fall this year as economic crisis and volatile metal prices hit demand.

Mr Mr Claudio De Cani director of Italy's nonferrous metals association Assomet said that "We have a situation of general crisis which starts with consumption and goes all the way up to production. High prices are just adding fuel to the fire. Output of copper and alloy semi finished products is expected to fall 2.4% to 1.033 million tonnes this year.

Mr De Cani said that demand is seen stable at 1.046 million tonnes but the figure takes into account that producers will rebuild their stocks after a drop in production last year while end user demand will be weak. Production of aluminium and alloy semi finished products is seen falling 4.7% to 783,500 tonnes this year with apparent demand falling 5.6% to 763,500 tonnes.

He said that the demand and production situation in both industries deteriorated sharply in the final quarter of last year when Italy's economy turned sour amid growing concerns about the country's debt.

Italy's output of copper and alloy semi finished products fell 4.8% YoY to 1.058 million tonnes in 2011 while its output of aluminium and alloy semi finished products fell 2.8% to 822,000 tonnes.

The euro zone's third biggest economy contracted in the third and fourth quarters of 2011, underscoring the challenges for Prime Minister Mr Mario Monti as he seeks to avert a debt crisis and turn around the economy.

Austerity measures launched by Mr Monti's government, including increased housing and value added taxes have played a part in discouraging consumer demand.