Bloomberg reported that copper demand growth in China may drop by half this year to the weakest since 2006 as the economy slows and subsidy programs end.

Mr Shen Xiaoqiang 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 13% 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 2011 after two years. Appliance makers are the second largest copper users in China.

Mr Shen said recently 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.

State researcher Beijing Antaike Information Development Company has said that China’s refined consumption may rise 6.4% to 7.85 million tonnes this year compared with growth of 8.5% in 2011 and 11.5% in 2010. JPMorgan Chase & Company estimates Chinese demand will gain 6% this year while Standard Bank Group Limited forecasts growth of 6.6%.

(Sourced from Bloomberg.net)