The strategic importance and future development of the raw material industries across Europe are the subject of two recent reports published by the EU institutions. Whereas the Commission has analysed the competitiveness of the EU non-ferrous metals industry, the Parliament has developed a text aimed at securing an effective raw materials strategy for the 27 member states.

In the Autumn 2011 edition of Copper Wire, we take a closer look at both reports and underline the findings of particular relevance for the copper industry. We are fortunate to be able to include, in the ‘view from the outside’ section the perspectives of MEP Reinhard Bütikofer, Vice-Chair of the European Parliament’s Greens/EFA Group.

Given the importance of this topic, it is only appropriate that we describe some of the broad societal benefits that copper products deliver to Europe’s citizens and its economy. In this edition, we highlight examples in healthcare, aquaculture and construction.

John Schonenberger
Chief Executive
European Copper Institute

Globalisation, economic development and population growth are combining to create ever greater competition for natural resources in all sectors. EU industries active in the telecoms, transport, energy and other hi-tech sectors are facing tougher competition from rapidly expanding economies. As examples, Chinese and Indian companies are building long term supply security by increasing their capital investments in Africa and Latin America, which are home to some of Earth’s largest reserves of minerals and metals.

Continued short and long term competitive access to necessary raw materials has therefore become an issue of increased strategic concern for Europe. These materials not only generate direct economic value from their trade, manufacturing and use, they also ensure the continued development of our societies. Raw materials, particularly those non-ferrous metals, such as copper, aluminium, nickel, silver and tungsten, that have a broad range of performance characteristics, are vital to the ongoing development and commercialisation of new technologies, infrastructure and related services.

A recently released report on the ‘Competitiveness of the EU Non-ferrous Metals Industries’, conducted by ECORYS and Cambridge Econometrics for the European Commission (with contribution by the European Copper Institute) is testament to that fact. The purpose of the study was to provide the Commission with a clear and up-to-date understanding of the competitiveness of the EU non-ferrous metals industry; as it is now, how it might develop and how it could be improved. It provides a great insight into some of the challenges and opportunities facing the sector, as well as the downstream industries dependent upon its activities. The key findings, relevant to the copper industry, are summarised below.

Territorial availability of naturally occurring raw materials

Due to limited supplies of indigenous ores, the EU copper industry is highly dependent on imported raw materials. Indeed, between 2000 and 2008, European production of refined copper only met a little bit more than 60% of end-use demand. In addition, even if the EU is rich in “urban mines” (stocks of recyclable materials recoverable after their usage phase), the copper recycling industry is facing fierce competition from China and India to secure these. Developing countries have lower recovery costs and can therefore offer a better price for scrap. As a result, in 2009, nearly 1 million tons of copper scrap were exported out of the EU.

 Pricing and cost factors

Unlike almost all other industries, the price of non-ferrous metals are set, not by the producers, but based on global supply and demand through the London, Shanghai and Chicago metals exchanges. As a result, the competitiveness of a copper producer is dictated far more by its cost structure than the pricing of its products. Combined with the fact that the industry is capital, resource and energy intensive, this results in a fundamental challenge for the industry in Europe. Copper producers are vulnerable to the EU’s high energy prices and multiple environmental policies, such as the Emissions Trading Scheme (ETS), waste regulation and chemicals regulation (REACH), especially compared to other regions with far lower levels of environmental and social protection. The report notes that this is a particular challenge since the EU copper industry is already highly energy efficient, having achieved 50% energy savings since 1996.

Investment trends in primary production

The reality is evident with non-ferrous primary metal production moving to areas that offer cheaper, long term energy solutions. The Middle-East, for example, is pursuing a policy to diversify its economy by attracting energy intensive industrial activity, while China is building large-scale best-practice smelters swiftly and effectively. Within the EU, there is little evidence of substantial investments in upstream segments, where higher environmental compliance costs, along with inconsistency and uncertainty over energy policy, are acting as barriers.

EU overview, advantages and necessary action

The closeness of copper producers to their customers has been a traditional strength of the sector. However, in recent years, value chains have been dis-aggregating as primary production moves outside the EU.

In terms of metal production, EU investment now relates more towards recycling and secondary production, with specialist facilities to process increasingly complex end-of life materials. Close proximity to some of the most demanding global users of non-ferrous metal products (i.e. European car and aerospace industries) has stimulated the industry to develop high quality, tailored and technologically advanced solutions. This type of innovation, leading to higher value added and higher quality fabricated products, is critical if the European industry is to compete with the many, lower wage developing nations.

Finally, the report concludes that the trade-off, between an ever increasing dependency on raw material imports versus keeping more primary production within the EU, would be clarified if critical, long term issues related to the ETS and energy costs were able to be addressed.

Reinhard Bütikofer MEP is Vice-Chair of the European Parliament’s Greens/EFA Group. He sits on the Industry, Technology and Research Committee and, in 2011, was rapporteur of the report on an effective Raw Materials Strategy for Europe.

“What could have been a relatively pleasant train journey in October to visit the Dutch Young Greens in Groningen turned into an hour-long bus ordeal. A few weeks prior to that my wife fell victim to a similar fate travelling in Germany. The reason: copper from the railway lines had been stolen. Copper theft has seen a dramatic surge in the European Union over the past year. In Britain, it has transformed from being a minor occurrence to nearly a dozen incidents a week.

This phenomenon naturally got worse when the red metal scraped the $10,000/tonne mark at the London Metal Exchange (LME) as robust demand and lower than expected mine output led to tightness in the market. Standing on the verge of a double-dip recession, prices have calmed in recent months falling to $7,300/tonne. China’s recent revelation of its copper inventories, which were much higher than expected, has also exhibited a certain downward pressure on prices.

Nevertheless, the supply-demand balance and market outlook remain precarious. A wave of threshold economies has emerged alongside the existing industrialised countries, raising international demand, while supply is struggling to keep up. Over the last decade, China’s share of global copper usage, for example, has exponentially risen from 12 to 40 per cent.

New mines can of course provide some relief but the belief that they will quickly come on-line and remedy the situation seems illusory. In the summer, BHP Billiton’s Chief Executive, Marius Kloppers, already warned that new mines will take longer to come on-stream and that the ability of the industry to relieve high metals prices is overestimated.

Besides new mines, however, recycling is a fundamental pillar of today’s copper supply, which also saves a significant amount of CO₂ emissions contributing to the EU’s fight against climate change. This must be expanded. While there have been announcements declaring that the limits of recycling have been reached, there could be nothing further from the truth.

In my report on raw materials, which has been overwhelmingly passed by the European Parliament in September, I have made a number of proposals to this end. For example, the report calls on the European Commission to investigate to what extent old landfills could be opened up to access scrap metal for recycling with currently best-available technologies. Landfills can hold an incredibly large amount of copper. According to a recent UNEP Report, a global stockpile of 225 million tonnes of copper are estimated to be in landfills. A global copper usage of roughly 20 million tonnes therefore only represents 9 per cent of those tremendous urban mines. With increasing prices, the economic feasibility of tapping those resources should become more attractive. In addition, besides old landfills, “hibernating” stocks, such as electrical goods, obsolete undersea cables and others, should also be considered.

Red-hot copper is our economies’ lifeline and a key source for a green transformation to sustainable low-carbon economy. It’s time we treat it as such and don’t let it lie around in waste streams as if it had a shelf life.”

Editor’s note: we have respectfully substituted Mr. Bütikofer’s use of the word consumption by usage. Oil and electricity are consumed. Copper can be used and re-used, over and over again, without any loss in performance.

Eurometaux, the voice of the European Non-Ferrous Metals industry, (ECI is a member) offered its support to the Parliament’s Industry, Research and Energy Committee following the adoption of amendments to Mr Bütikofer’s ‘Report on effective raw materials strategy for Europe’ and called for the swift and concrete implementation of the objectives and actions identified.

The committee called for greater understanding of raw materials flows, uses, potential shortages, and criticality. In particular, it gave its support for boosting:

• recycling by means of various measures, including innovation
• combating illegal waste shipments
• an international certification scheme for recycling facilities
• a gradual landfill ban for household waste, and urban mining projects
• increased support for innovation
• support for the training of personnel
• free and fair market access

Eurometaux believes that access to both primary and secondary raw materials from EU sources and on international markets are important and complementary and that resource efficiency and recycling, notably through innovation, deserve increased attention.

The European Copper Institute attended AquaNor 2011 in Trondheim, Norway. ECI demonstrated the use of innovative copper alloys for both near- and off-shore marine aquaculture enclosures. The exhibit highlighted copper’s role in meeting the three main challenges of the fish farming industry – to ensure product quality, to protect human health and to take care of the local environment.

Today, almost half of all seafood comes from aquaculture and demand continues to grow. The world’s annual consumption of fish and seafood has increased by 65% since the 1960s to reach 17 kg per person in 2010. In particular, salmon is about to replace chicken on our plates.

To meet demand growth, whilst maintaining high quality, the aquaculture sector has to address three challenges:

• Increased volume: production has increased by 71% in the last 10 years.
• Improving the sanitary conditions at the production site.
• Lessening the environmental impact by preserving the marine environment, reducing waste and respecting biodiversity.

The use of copper alloy nets in marine aquaculture helps to improve fish health and production, prevent predator attacks and escapes, maintain cage volumes and minimise maintenance costs.

A specific example of the benefits provided by copper mesh is that it naturally inhibits biofouling. This enables better water flow circulation, allowing higher levels of dissolved oxygen, reduces pen fouling, decreasing the number of parasites, disease organisms and the use of antibiotics. This also minimises the requirement for cleaning, meaning the fish are disturbed less often, providing cost savings and health benefits.

The comparative durability of copper mesh protects fish against predators and dramatically reduces the likelihood of escape. Its strength also helps to ensure structural integrity even against strong ocean waves and offshore currents.

For more information about copper alloys in marine aquaculture, watch the video on our You Tube channel.

The winners of the 2011 European Copper in Architecture Awards were announced at a presentation ceremony in Brussels on 27th September. With 66 entries – the highest so far – and generally exhibiting a high standard of design, the Awards are a celebration of the very best in contemporary European architecture and recognition of the influence of copper in modern design.

Selected from seven shortlisted projects, the outright winner was the Chapel of St. Lawrence, Vantaa, Finland, designed by Avanto Arkkitehdit. The building uses similar materials to the old structures in the area and the roof is patinated copper, like the roof of the old church. Many of the ceilings are finished with removable, perforated copper trays. The glazed walls toward the graveyard in the chapels are covered with a patinated copper mesh, which functions as a screen between the outside and the internal spaces of the chapel. The jury found this project a highly compelling and atmospheric study in the handling of space, light and materials.

Projects from Spain, Finland, Italy, the United Kingdom, Germany and Luxembourg were shortlisted for the awards by an international team of architect and editor judges.

Copper, like other metals, is an in demand building material due to its intrinsic properties. Visit ECI’s YouTube Channel, “Imagine Life Without”, to watch a video on the awards ceremony.

The recent E.coli outbreak proves how vulnerable we all are to harmful bacteria. So, it is a good time to emphasise the role copper plays in our health and in the prevention and control of infections.

Early results from a comprehensive, multi-site clinical trial have demonstrated that the use of Antimicrobial Copper touch surfaces in intensive care units (ICU) resulted in a 40.4% reduction in the risk of acquiring a hospital infection. Initial study results were presented at the World Health Organisation’s first International Conference on Prevention and Infection Control (ICPIC) in Geneva, Switzerland on July 1^st, 2011.

Dr. Michael Schmidt, Professor and Vice Chairman of Microbiology and Immunology at Medical University of South Carolina (MUSC), who presented the results, said, “Bacteria present on ICU room surfaces are probably responsible for 35 – 80 percent of patient infections, demonstrating how critical it is to keep hospitals clean. The copper objects used in the clinical trial supplemented cleaning protocols, lowered microbial levels, and resulted in a statistically significant reduction in the number of infections contracted by patients treated in those rooms.”

Read on to learn about the first European installation of an innovative copper alloy aquaculture system, our participation in the European Green Week, to see where we will be over the coming months or to watch our latest video which promotes the many benefits of using copper based systems in the built environment.

I hope this issue increases your awareness and understanding on how Copper is Essential for Everyone’s health and overall well-being.

John Schonenberger
Chief Executive
European Copper Institute

Early results from a comprehensive,3-year multi-site clinical trial in the US demonstrate that the use of antimicrobial copper surfaces in intensive care unit rooms resulted in a 40.4% reduction in the risk of acquiring a hospital infection. Initial study results were presented at the World Health Organization’s 1st International Conference on Prevention and Infection Control (ICPIC) in Geneva, Switzerland on July 1st, 2011.

The study, funded by the US Department of Defense, was designed to determine the efficacy of antimicrobial copper in reducing the level of pathogens in hospital rooms, and whether such a reduction would translate into a lower rate of infection.  Researchers at the three hospitals involved in the trial – Memorial Sloan Kettering Cancer Center in New York, the Medical University of South Carolina (MUSC) and the Ralph H. Johnson VA Medical Center, both in Charleston, South Carolina – replaced commonly-touched items such as bed rails, overbed tray tables, nurse call buttons and IV poles with antimicrobial copper versions.

Copper components demonstrated a 97% reduction in surface pathogens, the same level achieved by “terminal” cleaning: the regimen conducted after an infected patient vacates a room.

Dr Michael Schmidt, Professor and Vice Chairman of Microbiology and Immunology at MUSC, who presented the results at ICPIC, said: “Bacteria present on ICU room surfaces are probably responsible for 35-80% of patient infections, demonstrating how critical it is to keep hospitals clean. The copper objects used in the clinical trial supplemented cleaning protocols, lowered microbial levels, and resulted in a statistically significant reduction in the number of infections contracted by patients treated in those rooms.”

In healthcare facilities around the world, 7 million infections occur every year. In addition, these infections cost over $80 billion globally, according to the World Health Organization.

Independent laboratory testing has demonstrated that, when cleaned regularly, antimicrobial copper products kill greater than 99.9% of microorganisms.  These include deadly antibiotic-resistant bacteria such as MRSA, VRE and other bacteria which can cause fatal infections, such as Clostridium difficile.  Antimicrobial copper has also been proven effective against viruses such as Influenza A and pathogenic fungi.  Antimicrobial copper is the only family of solid materials that has been registered with the US Environmental Protection Agency as capable of killing disease-causing organisms.

For more information, visit www.antimicrobialcopper.com.

To view the interview with Dr. Schmidt at ICPIC, click here.

At a rate of 40 million tonnes per year, global fish consumption is expected to grow by 40% by 2030, making the threat of depleting fish stocks more real than ever. Today aquaculture already supplies nearly half of the global fish demand, having a huge potential to meet this projected growth in fish consumption in a sustainable way.

Increasing aquaculture productivity needs to remain a central focus and farmers will need to look into new materials and technologies that reduce biofouling, corrosion and fish loss due to escapes or predator attacks.

Due to its natural biological and metallurgical properties, copper alloys are a perfect material for both surface and submersible marine aquaculture enclosures for near- and off-shore sites. Copper alloy mesh aquaculture cages improve the sanitary conditions, productivity and sustainability of operations for farmers raising salmon, trout, sea bream, sea bass, cod, cobia, yellow tail and other species.

Fish farmers are already capitalizing on the benefits of copper alloy meshes in Japan, Australia and Chile and this summer, the Dardanelles Strait became the first European fish farming site to install an innovative copper alloy cage.

Designed to eliminate common fish farming problems, such as biofouling, damage from storms and strong undercurrents, the cages selected by the scientists at Canakkale Onsekiz Mart University and University of New Hampshire have been deployed in 50 metres of water, and are stocking 15,000 European sea bass (4.5 tonnes).

The installation builds on recent research conducted in Tasmania and Chile. In both cases, fish farming experts confirmed that aquaculture cages, made of copper alloy mesh, enhanced the productivity and sustainability of their operations. They also improved sanitary conditions, by enabling greater water circulation and higher oxygen levels, two key factors required for the production of healthier fish.

Studies have also proven that copper alloy meshes inhibit the undesirable accumulation of microorganisms – an important factor given that bio-fouling is a costly issue, for fishermen around the world, as traditional meshes require regular cleaning every few months. In comparison, copper alloy cages have high strength, require little maintenance and will last for five years or more. They also preserve their original shape against the strongest currents, prevent escape and reduce losses to predators, such as sharks and seals.

ECI expects that the results from this trial will trigger the deployment of additional copper cages, throughout Europe, thus helping the aquaculture industry grow its output in a highly sustainable way.

As part of the European Commission’s Green Week (24 – 27 May 2011), ECI coordinated a series of awareness-raising activities to demonstrate the benefits of introducing binding EU energy efficiency targets. ECI also called on the EU institutions to show stronger support for resource efficiency through measures to increase the recovery and recycling of copper (in fact, all metals). Doing so will reduce energy use, cut CO₂ emissions and secure European supplies of valuable secondary raw materials.

ECI warned of the negative outcomes of end-of-life (scrap) copper leaving the EU to countries with lower recovery technologies and poorer health and environmental protection measures. Recovery and recycling also delivers an 80% reduction in energy usage compared to primary production.

Green Week was attended by more than 3,000 visitors, including EU officials, journalists and students, along with representatives of think tanks, trade associations and NGOs. At ECI’s booth, staff explained to visitors why the intelligent use of copper is an important contributor to building a sustainable European society and reaching the EU’s 20/20/20 targets. ECI’s messages were reinforced in the presentation, from Roger Sundqvist of Boliden AB, which centred on “Mining waste: boosting efficiency in the EU’s extractive industry.”

Under the slogan “Living Better … with Copper,” ECI distributed materials illustrating the unique benefits of copper in the context of a sustainable and modern society. One key message was that, depending upon the application, this can mean either an increase in copper use, e.g. to improve electrical energy efficiency, or a decrease, e.g. in the miniaturisation of high-tech devices, such as smart phones and tablet computers.