Bloomberg reported that copper demand growth in China may decline by half this year as the economy slows and subsidy programs end according to the metals trader that’s owned by the country’s biggest auto parts maker.

Mr Shen Xiaoqiang a researcher at Wanxiang Resources Company said that refined metal consumption may expand 4% to 5%. That compares with 8% to 10% in 2011 and more than 10% in 2010.

The metal used in wires has rallied 12% this year on speculation that the US economy is recovering and as stockpiles tracked by the London Metal Exchange fell. China which accounts for 40% of global copper demand ended a home appliance subsidy program on December 31st after 2 years. Appliance makers are the second-largest copper users in China.

Mr Shen said that “Demand in the past two years was aided greatly by subsidies for home appliances. While demand from government projects will continue, we remain a bit more pessimistic than consensus unless there are new measures to boost consumer spending.”

He said that copper demand from China’s construction industry may be relatively flat as the government continues to increase the supply of so called social housing even amid other property market cooling measures, such as higher down payments.

(Sourced from Bloomberg.net)