Copper Usage India - Overview Sanjeev Ranjan

Outline Global Copper Semis End Use India Copper Semis End Use

Global Copper Semis End Use

COPPER USAGE BY GEOGRAPHY Unit: kt Cu 2017 % total of Global Annualized Growth 2006 - 2017 China 13368 47.5% 7.4% Western Europe 3133 11.1% -2.0% North America 2223 7.9% -4.7% Eastern Europe 1298 4.6% -1.9% Latin America 1676 6.0% 0.1% Japan 1201 4.3% 0.7% India* 1266 4.5% 4.8% ASEAN 1217 4.9% South Korea 846 3.0% Taiwan 424 1.5% -2.6% ROW 1477 5.3% -4.3% Total Global 28130 100.0% 1.6% Source: IWCC/ICA *Includes Indian subcontinent

Key drivers for economic growth and related copper consumption Industrialization Urbanization Living Conditions Sustainable Development Scale of Growth Pattern of Growth Social Development Economic Development Public private investment Domestic Consumption Export Low carbon development Safety, reliability & human health Cost, material saving and substitution In most cases, the growth path taken by economies are from industrialisation to rapid urbanisation. At this statge, scale of public private investment, domestic consumption and exports plays an important role. High copper requirement in infrastructure development. Most developing nations falls under this kind of development. As the economies gradually moves towards better standard of living and focuses on sustainable development, energy efficiency, low carbon emission, safety and reliability starts gaining importance. Copper demand is driven by energy efficient equipment and alternate energy sources.

Global Semis Demand by Region China’s share has almost doubled , India has shown marginal growth and others declined Global Semis Demand by Region

Global Demand Drivers Belt and Road Initiative of China - to add 6.5 million tonnes by 2027 Global growth of Electric Vehicle - to add 2 million tonnes by 2027 Global shift to low carbon economy – Renewable Energy efficient appliances

Electric Vehicle Forecast (IDTechEx) – to add 40 – 60kgs per vehicle

India Copper Semis Usage

Copper Usage by Semis - grew at CAGR of 6% over FY 2016

Copper Usage by Sector Electrical sector applications account for ~52% of the total demand (CAGR of 5%). Almost 25% of the total demand is met through recycled Copper Breakdown of the current demand for Copper in India (FY18) in kT, %share Demand for Primary Copper vs. Secondary Copper (FY18) in kT

Growth Drivers for End-use Sectors Impact of growth driver on sector growth High Medium Low Electrical Real Estate sector growth Planned generation capacity addition Manufacturing sector growth Rural electrification drive Consumer Durables Penetration of residential Air Conditioners Disposable income growth Commercial Real Estate growth Transportation Rail electrification drive Construction Residential Real Estate sub-sector growth Addition of hospital beds Growth in number of PNG connections Renewables General Engineering

Copper imports have risen due to closure of 1 smelter (1/2) HS Code Commodity 2014-15 2015-16 2016-17 2017-18 Countries 2017-18 2018-19 YTD# 74031100 Cathodes and sections of cathodes of refined Copper 27,930 22,802 26,738 36,257 Japan (67%) R. Congo (22%) 9,566 74031900 Other refined Copper, unwrought   8,849 8,978 7,601 6,552 Malaysia (73%)* 2,052 74071010 Electrolytic Copper rods or black Copper rods(including coils),wrought   8,710 13,195 9,139 1,171 UAE (60%) Malaysia (23%) 292 74071020 Copper rods other than electrolytic, wrought   22,397 23,407 15,641 9,748 UAE (74%) 3,374 74111000 Tubes and pipes of refined Copper   27,627 35,306 41,120 49,339 Vietnam (52%) Malaysia (24%)* 16,193 74091900 Other plates, sheets etc. of refined Copper   7,147 6,412 6,654 6,759 China (54%) Taiwan (15%) 2,158 74102100 Foil of refined Copper, backed   9,284 9,439 11,732 12,220 China (72%) 3,642 74081190 Other Copper wire with max cross-sec diameter>6mm   79,955 93,719 79,102 64,185 UAE (86%) 34,775 # April-June 2018

Copper imports have risen due to closure of 1 smelter (2/2) HS Code Commodity 2014-15 2015-16 2016-17 2017-18 Countries 2017-18 2018-19 YTD# 74081190 Other Copper wire with max cross-sec diameter>6mm   79,955 93,719 79,102 64,185 UAE (86%) 34,775 74081990 Others with cross section<=6mm   17,307 52,611 88,467 1,30,445 Indonesia (20%) Malaysia (36%) Vietnam (27%)* 48,322 74040012 Copper scrap covered by various ISRI codes 52,641 56,896 45,017 44,444 Saudi Arabia (30%) UAE (23%) Qatar (12%) 19,650 74040022 Brass scrap covered by various ISRI codes 1,07,641 1,18,801 1,21,759 1,27,116 UK, USA, Germany and Various 40,765 # April-June 2018 * FTAs are zero for Tubes, rods less than or equal to 6mm from ASEAN countries

Copper Net Imports – cathode export has reduced HS Code Commodity 2014-15 2015-16 2016-17 2017-18 2018-19 YTD# 74031100 Cathodes and sections of cathodes of refined Copper  -3,39,765 -2,96,730 -3,10,331 -3,42,205 2,331 74031900 Other refined Copper, unwrought   8,601 8,957 7,471 6,477 2,049 74071010 Electrolytic Copper rods or black Copper rods(including coils),wrought   8,344 12,732 8,818 821 175 74071020 Copper rods other than electrolytic, wrought   21,529 21,891 14,481 8,259 2,966 74111000 Tubes and pipes of refined Copper   26,901 34,089 39,665 47,589 15,386 74102100 Foil of refined Copper, backed   9,277 9,416 11,730 12,218 3,642 74081190 Other Copper wire with max cross-sec diameter>6mm   73,000 77,997 65,215 26,611 30,306 74081990 Others with cross section<=6mm   15,148 50,516 85,454 1,27,722 47,745 74040012 Copper scrap covered by various ISRI codes  52,054 56,148 44,671 43,733 19,602 74040022 Brass scrap covered by various ISRI codes 1,06,739 1,17,752 1,20,184 1,25,336 40,217 74040029 Other brass scraps   5,037 4,084 3,109 1,211 237

Impact on Copper Supply Increase in import of wire rods Rise in Import of finished goods from ASEAN region as it comes under zero duty under FTA to impact domestic producers Increased usage of low grade copper coming from unregistered players under secondary route Currently almost 25% of copper demand is met through secondary copper Copper supplied by unregistered players can achieve only 70%-80% conductivity which is way below ideal conductivity of minimum 99.99%

Thank you For more information please contact Sanjeev.Ranjan@copperalliance.asia