By Tatyana Shumsky
Manufacturers of copper products are looking at niche markets like solar and wind power, mining and oil and gas exploration to drive growth amid a sluggish economy.
Copper is widely used for electrical wiring and water plumbing, as well as in heat-transfer applications such as air conditioners. Copper fabricators have long relied on these applications in the construction and manufacutirng industry to drive growth.
However, the slow pace of economic recovery is seeing some copper product makers take a second look at niche markets for a source of diversification and growth.
“All over the world people are trying to find ways of doing the same thing but wasting less … that is where our biggest opportunities are,” said Justin Roux, vice president at privately held Luvata, a copper product maker with EUR2.4 billion ($3.3 billion) in sales and 31 production facilities in 13 countries.
Part of Luvata’s focus is on the solar-power sector which requires an especially thin and flexible copper wire for efficient solar power panels, Roux said.
Luvata is also promoting the use of its copper anti-fowling wire for the fishery industry. Copper fish farm cages aren’t prone to seaweed build up, which can block water flow and breed infection, making fish farming more efficient.
“Small segments of the market like auto harnesses, wind generation wire, oil platform and mining cable are going strong. They’re just a small market segment,” said one physical metals trader.
Some copper wire and cable companies are looking at introducing or expanding products aimed at fast-growing industries like wind generation, oil and gas exploration and mining, all of which have more specialist needs than building and construction wire and cable.
“Why try to compete in something that’s peanut butter and jelly, go for the unique stuff,” said a purchasing manager for a copper product maker focusing on the air conditioning, heating and refrigeration market which is developing specialist products for the automotive industry.