BEIJING (Commodity Online): China's copper demand growth may shrink by 50% in 2012 on the back of a cutback in a government subsidy program. China is the largest copper consumer in the world, accounting for almost 40% of global consumption.
In an interview with Bloomberg,Mr Shen Xiaoqiang, researcher at Wanxiang Resources Company, Chinese copper demand growth may decline to 4%-5% in 2012 compared to 8%-10% in 2011 which essentially means that demand growth will be cut by 50%.
One of the primary drivers of copper demand has been the home appliances sector, a category which has seen robust growth over the past two years thanks to a government subsidy program. But with the government closing down the subsidy programme on Dec 31, 2011, cost of home appliances will increase and this may keep buyers at bay resulting in lower demand for copper and its imports.
Combined with decline in property prices and decreasing enthusiasm in infrastructure projects, Chinese demand looks all set for a decline
