A report revealed that China’s advancement of its new infrastructure plan, which involves beneficiation, will increase the production of high-end metals. The focus on advanced infrastructure has been more active after the decrease in economic activity as a result of the coronavirus pandemic and the heightened tensions between China and the United States.
The report predicts that this infrastructure plan will work together with other industrial policies in China, such as China Standards 2035 Plan and Made in China 2025. These reflect the country’s ambitious strategy that will enable it to become a global leader in innovative and high-tech industries of the future.
These new infrastructure projects, which include transport and energy infrastructure such as high-speed rail, charging stations and UHV technology (ultra-high-voltage), as well as artificial intelligence systems, data centers and 5G networks, need a considerable amount of more advanced and lighter metals in their construction.
Fitch Solutions, which authored the report, believes that the domestic demand for steel, aluminum and high-end copper in China will grow, starting this year going forward. Apart from this, its metal production value chain will also grow and strengthen the market share of state-owned metal enterprises. The financial abilities and technical expertise of large, metal, state-owned enterprises (SOEs) will make sure that China emerges as the largest beneficiary of this climb up the value chain.
The industrial analyst predicts that the new projects will need about 32 million tons of specialty steel and 1 million tons of high-end aluminum this year alone, which makes up 3% of domestic demand for the two metals. However, as more projects are undertaken next year, these figures will increase, with the UHV power cables being the main driver of the demand for these metals, closely followed by 5G network base stations, high-speed rail and urban mass transit.
The report highlights that Chinese metal SOEs will benefit greatly from the infrastructure plan acceleration, as they have the technical knowledge to produce high-end metals as well as the economies of scale to profit from them. Additionally, China moving up the metals production value chain will accelerate acquisitions and mergers so as to grow the market share of big metal SOEs.
New energy vehicles, electrification of new railways and the installation of higher-efficiency distribution transformers and industrial motors will also increase consumption of copper in China by 232 kilotons yearly up to 2025, as estimated by the International Copper Association.
The industrial analyst company also reports that in order to have enough ores for metal production, the accelerated investment in new infrastructure and the resulting domestic production of higher-end metals will be accompanied by investments in mining projects overseas.
An interesting firm you should watch in the mining sector is GoldHaven Resources Corp. (CSE: GOH) (OTCQB: ATUMF). The company focuses on acquiring and exploring properties rich in mineral resources, and it recently acquired seven properties in Chile’s Maricunga Gold Belt.
About MiningNewsWire
MiningNewsWire (MNW) is a specialized communications platform focused on developments and opportunities in the global resources sector. The company provides (1) access to a network of wire services via NetworkWire to reach all target markets, industries and demographics in the most effective manner possible, (2) article and editorial syndication to 5,000+ news outlets (3), enhanced press release services to ensure maximum impact, (4) social media distribution via the Investor Brand Network (IBN) to nearly 2 million followers, and (5) a full array of corporate communications solutions. As a multifaceted organization with an extensive team of contributing journalists and writers, MNW is uniquely positioned to best serve private and public companies that desire to reach a wide audience of investors, consumers, journalists and the general public. By cutting through the overload of information in today’s market, MNW brings its clients unparalleled visibility, recognition and brand awareness. MNW is where news, content and information converge.
To receive SMS text alerts from MiningNewsWire, text “BigHole” to 21000 (U.S. Mobile Phones Only)
For more information, please visit https://www.miningnewswire.com
Please see full terms of use and disclaimers on the MiningNewsWire website applicable to all content provided by MNW, wherever published or re-published: https://www.miningnewswire.com/Disclaimer
MiningNewsWire
Los Angeles, California
www.miningnewswire.com
310.299.1717 Office
Editor@MiningNewsWire.com
MiningNewsWire is part of the InvestorBrandNetwork.
