Copper
The Philippine copper industry envisions a sustainable and fully-integrated copper industry in the country from mining to downstream manufacturing, where value is maximized, together with the development of the several domestically manufactured copper-using commodities such as wiring harness, high efficiency motors and appliances that will serve both the local and global markets.
It is envisioned that in the upstream, one to two large world class copper mines (particularly Tampakan) are developed and starts production. At midstream, a revival of investor interest in the production of copper wire rods and the establishment of a copper rod casting facility. And at the downstream, development of new copper products that will link with the wire harness industry, as well as information gathering, research, forums, studies, and the like are conducted to explore the possibility of venturing into new copper applications.
In the short-term (by 2016), the specific milestone would be the establishment of a venue for industry stakeholders to work together in support of the roadmap aspirations. Within the medium-term (by 2022), the key goals are further increase in the production of copper concentrates as the one or two new mines start operations. Over the long-term (by 2030), the linkage between local mining and smelting is established; there is near self-sufficiency in copper rods; and the development of higher value copper products for both local and the global markets are in full steam.
The vision of a fully integrated copper industry by 2030 is to be fulfilled by the operation of select world class copper mines, development of a wire rod casting facility, and promotion of higher value copper products.
01
About Copper
The Philippines is one of the countries with vast amounts of mineral resources, including large reserves of metallic and non-metallic minerals such as gold, nickel, iron, copper, limestone, and marble. Among the metallic minerals, the largest reserve is copper, which is estimated at 4 billion MT, making the Philippines the fourth largest country in the world in terms of copper reserves.
From such vast reserves, the industry produces copper concentrates, cathodes, and wires. The production of such commodities is estimated to have contributed 9.74 billion pesos in 2011. Local demand for concentrates emanating from copper manufacturers is very high. The Philippine Associated Smelting and Refining Corporation (PASAR), which is a key player in the copper industry, has an annual demand of 720,000 MT, which is met through importation of copper concentrates given that local production of such inputs remains insufficient. The industry provides jobs for 7,300 Filipinos, with PASAR employing 1,000 workers.
The following are the copper industry’s major products: concentrates (from mineral extraction); cathodes and blisters (from smelting/refining); rolled products, tubes, rods, and other semi-finished products (from transformation); and wires and cables, harnesses, plating and foils (processing semi-finished products).
There are eight (8) products in the Philippines that define the copper industry. These are copper and ore concentrates; unrefined copper/anodes; refined copper and alloys which include cathodes; cast rods, bars and profiles; copper wires; plates, sheets, and strips; copper foil; and tube or pipe fittings.
There is high demand for copper products coming from Philippine industries, particularly electronics and automotive parts manufacturing. Electronics production makes use of copper foils, while automotive parts manufacturers utilize copper in automotive wires and harnesses. The industry also has linkages with metal fabrication (cutlery, hand tools, general hardware; metal containers), the manufacture of non-electrical machinery (metal and wood-working machinery; and pumps, compressors, blowers and air conditioners), non-ferrous foundries, and the manufacturing of transport equipment and land transport services.
Favorable economic conditions in the country and the region can serve as a catalyst for better prospects for the industry. The Philippines impressive economic performance in recent years bodes well for the growth of manufacturing industries, including the copper industry. The recognition of this growth by international organizations and the series of investment ratings upgrades granted by international credit agencies further attest to the country’s strong fundamentals which are the foundation for industrial development.
02
Facts and Figures
Estimated Value Added of Major Copper Products (in B pesos, at constant 2000 prices)
| Product | Value added | % of GDP | ||||
| 2009 | 2010 | 2011 | 2009 | 2010 | 2011 | |
| Copper mining | 2.14 | 2.5 | 2.67 | 0.04 | 0.04 | 0.05 |
| Copper cathodes (non-ferrous smelting and refining) | 5.12 | 3.74 | 4.26 | 0.1 | 0.07 | 0.07 |
| Copper wire (insulated wires and cables) | 2.65 | 2.73 | 2.81 | 0.05 | 0.05 | 0.05 |
| TOTAL | 9.91 | 8.97 | 9.74 | 0.19 | 0.16 | 0.17 |
Value of Copper Products, Exports (X) and Imports (M) (in US$ million)
| 2000 | 2005 | 2009 | 2010 | 2011 | ||||||
| X | M | X | M | X | M | X | M | X | M | |
| Copper ore and concentrates | 28.4 | 237.8 | 36.9 | 460.4 | 149.8 | 909.7 | 268.2 | 1,326.20 | 355.9 | 757.7 |
| Unrefined copper; anodes | – | 2.6 | – | 11.5 | * | 3.6 | – | 5.3 | 0.3 | 76.7 |
| Refined copper and alloys | 239.6 | 27.4 | 361.7 | 35 | 688.1 | 36.2 | 807 | 62.8 | 1,130.10 | 100.7 |
| Cast rods, bars and profiles | * | 36.7 | 0.1 | 72.1 | * | 57.7 | * | 108.1 | * | 122.2 |
| Copper wire | 3.9 | 33.1 | 7.1 | 63 | 9.5 | 45.3 | 17.4 | 88.8 | 21.1 | 117 |
| Plates, sheets and strip | 0.1 | 53 | 0.6 | 78.4 | 0.4 | 82 | 0.9 | 69.1 | 0.3 | 112.2 |
| Copper foil | 29.6 | 6.9 | 35.3 | 2.6 | 86.6 | 17 | 143.3 | 29.8 | 150.9 | 19.7 |
| Tube or pipe fittings | – | 1.7 | * | 1.4 | 0.1 | 1.3 | 0.3 | 2.4 | 0.4 | 6.7 |
| TOTAL | 301.6 | 399.2 | 441.7 | 724.4 | 934.5 | 1152.8 | 1237.1 | 1692.5 | 1659 | 1312.9 |
Volume of Copper Products, Exports (X) and Imports (M) (in ‘000 MT)
| 2000 | 2005 | 2009 | 2010 | 2011 | ||||||
| X | M | X | M | X | M | X | M | X | M | |
| Copper ore and concentrates | 92.3 | 435.7 | 61.4 | 705.6 | 164 | 698 | 292.3 | 638.6 | 343.3 | 455.9 |
| Unrefined copper; anodes | – | 2.3 | – | 1.9 | 0.1 | 0.6 | – | 0.6 | 0.1 | 8.1 |
| Refined copper and alloys | 131.6 | 13.7 | 113.8 | 10.1 | 151.8 | 7.1 | 110.9 | 7.9 | 126.3 | 10.6 |
| Cast rods, bars and profiles | * | 18.1 | * | 19.4 | * | 11.1 | * | 18.2 | * | 20.7 |
| Copper wire | 2.2 | 14.8 | 2.2 | 15.9 | 2.2 | 9.3 | 3.2 | 11.3 | 3.7 | 12.6 |
| Plates, sheets and strip | * | 16.7 | 0.2 | 17.2 | 0.1 | 13.5 | 0.2 | 7.9 | * | 10 |
| Copper foil | 4.6 | 1.5 | 6.2 | 0.4 | 10 | 1.4 | 12.1 | 2.3 | 11.1 | 1.7 |
| Tube or pipe fittings | – | 0.4 | * | 0.4 | * | 0.3 | 0.1 | 0.6 | 0.1 | 0.9 |
| TOTAL | 230.7 | 503.2 | 183.8 | 770.9 | 328.2 | 741.3 | 418.8 | 687.4 | 484.6 | 520.5 |
03
Roadmap
04
Policies
Philippine Mining Act of 1995 (RA 7942)
The Philippine Mining Act of 1995 prescribes the rational exploration, development, utilization and conservation of the country’s mineral resources in public and private lands within its territory and exclusive economic zone. These are pursued through the combined efforts of government and the private sector in order to enhance national growth in a way that effectively safeguards the environment and protect the rights of affected communities.
The Department of Environment and Natural Resources (DENR) has promulgated the Revised Implementing Rules and Regulations of RA 7942.
The President issued Executive Order 79, providing policies and guidelines to ensure environmental protection and responsible mining in the country. The DENR promulgated its implementing rules and regulations.
IPP 2014-2016
The manufacture of copper wires and copper wire rods are among the preferred activities listed in the IPP.
This covers the manufacture of copper wire rods and enamelled wires, research & development, and technical vocational education and training institutions.
(1) Copper Wire Rod
Projects must have a minimum production capacity of 12,000 MT per year and would produce wire rods compliant with applicable international or Philippine National Standards for the production of copper wires and cables.
(2) Copper Wires
This covers the production of copper enamel wires. All enamelled wire products must be compliant with the applicable Philippine National Standards (PNS).
BPS Product Certification Scheme
The DTI’s Bureau of Product Standards lists certain copper products as among the products for mandatory certification under electrical products.
The certification of copper products is guided by the Philippine Standard (PS) Quality and/or Safety Certification Mark Scheme and the implementing guidelines for the issuance of PS certification mark license for insulated copper wire and flexible cords.
PNS for Copper Products
There is a mandatory Philippine National Standard covering electric copper wires, which covers thermoplastic copper wires and cables rated 600 volts, and copper and copper alloys.
05
Programs
Industry Development Program
The copper industry technical working group (TWG) conducts meetings to discuss and address industry concerns and issues. It includes representatives from BOI, PASAR, Philippine Electric Wires Manufacturers Association (PEWMA), copper miners, the Center for Research and Communication (CRC), National Development Corporation (NDC), Bantay Kita, and other concerned government agencies.
The TWG regularly meets the upstream and downstream stakeholders for updates on the industry roadmap activities. Among these are the following:
- Establishment of an “Eco-Industrial Park.” The Industry Development Council approved the conduct of a pre-feasibility by the NDC on the establishment of a green domestic manufacturing zone (i.e., an eco-industrial park) in Leyte, as proposed by the TWG. The park is envisioned to be a critical component in the full integration of the industry.
- Preparation of a pre-feasibility study on copper enamelling plant. The Wallace Business Forum (WBF) has submitted its Brief Market Study on Enamelled Wire, concluding that the focus of the development of the market for enamel wire should be on transformers and electric motors. Further research on the companies that exported transformers and electric motors is ongoing.
- Sourcing of Raw Materials from Local Mining Companies. The MICC instructed DTI to explore the possibilities of sourcing PASAR raw material requirements from local mining companies to increase value adding in the industry. PASAR and copper mine companies suggested other action items to promote the integration of upstream and midstream copper industry.
- Clarification re LOI 1387 (Copper Export Clearance). The TWG sought the opinion of the DOJ on the validity of LOI 1387, which required all copper exporters to obtain prior government clearance before shipping any product. The DOJ replied that it is only an administrative issuance and that PASAR lost the protection given by the LOI since it became a privately-owned entity.
06
Champions
Philippine Associated Smelting and Refining Corp. (PASAR)
11th/F, Zuellig Building
Makati Avenue cor. Paseo de Roxas,
Makati City, Philippines
Tel No.: (632) 889-6591 to 98
Fax: (632) 636-5263
Website: www.pasar.com.ph
Board of Investments (BOI)
Industry and Investments Building,
385 Senator Gil Puyat Ave,
Makati City Philippines
Tel. No.: (632) 897-6682 loc. 257
Email: SMSRecolizado@boi.gov.ph
