Development and Utilization of the World's and China's Bulk Mineral Resources and their Supply and Demand Situation in the Next Twenty Years
Authors: Zhaozhi ZHANG , Guangyu JIANG , Xianwei WANG , Jianfeng ZHANG 
Published: August 2016

Bulk mineral resources of iron ores, copper ores, bauxite, lead ores, zinc ores and potassium salt play a pivotal role on the world's and China's economic development. This study analyzed and predicted their resources base and potential, development and utilization and their world's and China's supply and demand situation in the future 20 years.

The supply and demand of these six bulk mineral products are generally balanced, with a slight surplus, which will guarantee the stability of the international mineral commodity market supply. The six mineral resources (especially iron ores and copper ores) are abundant and have a great potential, and their development and utilization scale will gradually increase. Till the end of 2014, the reserve‐production ratio of iron, copper, bauxite, lead, zinc ores and potassium salt was 95 years, 42 years, 100 years, 17 years, 37 years and 170 years, respectively. Except lead ores, the other five types all have reserve‐production ratio exceeding 20 years, indicative of a high resources guarantee degree. If the utilization of recycled metals is counted in, the supply of the world's six mineral products will exceed the demand in the future twenty years. In 2015–2035, the supply of iron ores, refined copper, primary aluminum, refined lead, zinc and potassium salt will exceed their demand by 0.4–0.7 billion tons (Gt), 5.0–6.0 million tons (Mt), 1.1–8.9 Mt, 1.0–2.0 Mt, 1.2–2.0 Mt and 4.8–5.6 Mt, respectively. It is predicted that there is no problem with the supply side of bulk mineral products such as iron ores, but local or structural shortage may occur because of geopolitics, monopoly control, resources nationalism and trade friction.

Affected by China's compressed industrialized development model, the demand of iron ores (crude steel), potassium salt, refined lead, refined copper, bauxite (primary aluminum) and zinc will gradually reach their peak in advance. The demand peak of iron ores (crude steel) will reach around 2015, 2016 for potassium salt, 2020 for refined lead, 2021 for bauxite (primary aluminum), 2022 for refined copper and 2023 for zinc. China's demand for iron ores (crude steel), bauxite (primary aluminum) and zinc in the future 20 years will decline among the world's demand, while that for refined copper, refined lead and potassium salt will slightly increase. The demand for bulk mineral products still remains high. In 2015–2035, China's accumulative demand for iron ores (crude steel) will be 20.313 Gt (13.429 Gt), 0.304 Gt for refined copper, 2.466 Gt (0.616 Gt) of bauxite (primary aluminum), 0.102 Gt of refined lead, 0.138 Gt of zinc and 0.157 Gt of potassium salt, and they account for the world's YOY (YOY) accumulative demand of 35.17%, 51.09%, 48.47%, 46.62%, 43.95% and 21.84%, respectively. This proportion is 49.40%, 102.52%, 87.44%, 105.65%, 93.62% and 106.49% of that in 2014, respectively.

From the supply side of China's bulk mineral resources, it is forecasted that the accumulative supply of primary (mine) mineral products in 2015–2035 is 4.046 Gt of iron ores, 0.591 Gt of copper, 1.129 Gt of bauxite, 63.661 Mt of (mine) lead, 0.109 Gt of (mine) zinc and 0.128 Gt of potassium salt, which accounts for 8.82%, 13.92%, 26.67%, 47.09%, 33.04% and 15.56% of the world's predicted YOY production, respectively. With the rapid increase in the smelting capacity of iron and steel and alumina, the rate of capacity utilization for crude steel, refined copper, alumina, primary aluminum and refined lead in 2014 was 72.13%, 83.63%, 74.45%, 70.76% and 72.22%, respectively. During 2000–2014, the rate of capacity utilization for China's crude steel and refined copper showed a generally fluctuating decrease, which leads to an insufficient supply of primary mineral products. It is forecasted that the supply insufficiency of iron ores in 2015–2035 is 17.44 Gt, 0.245 Gt of copper in copper concentrates, 1.337 Gt of bauxite, 38.44 Mt of lead in lead concentrates and 29.19 Mt of zinc in zinc concentrates. China has gradually raised the utilization of recycled metals, which has mitigated the insufficient supply of primary metal products to some extent. It is forecasted that in 2015–2035 the accumulative utilization amount of steel scrap (iron ores) is 3.27 Gt (5.08 Gt), 70.312 Mt of recycled copper, 0.2 Gt of recycled aluminum, 48 Mt of recycled lead and 7.7 Mt of recycled zinc.

The analysis on the supply and demand situation of China's bulk mineral resources in 2015–2035 suggests that the supply‐demand contradiction for these six types of mineral products will decrease, indicative of a generally declining external dependency. If the use of recycled metal amount is counted in, the external dependency of China's iron, copper, bauxite, lead, zinc and potassium salt will be 79%, 65%, 26%, 8%, 16% and 18% in 2014, respectively. It is predicted that this external dependency will decrease to 62%, 64%, 20%, −0.93%, 16% and 14% in 2020, respectively, showing an overall decreasing trend.

We propose the following suggestions correspondingly. (1) The demand peak of China's crude steel and potassium salt will reach during 2015–2023 in succession. Mining transformation should be planned and deployed in advance to deal with the arrival of this demand peak. (2) The supply‐demand contradiction of China's bulk mineral resources will mitigate in the future 20 years, and the external dependency will decrease accordingly. It is suggested to adjust the mineral resources management policies according to different minerals and regions, and regulate the exploration and development activities. (3) China should further establish and improve the forced mechanism of resolving the smelting overcapacity of steel, refined copper, primary aluminum, lead and zinc to really achieve the goal of “reducing excess production capacity”. (4) In accordance with the national strategic deployment of “One Belt One Road”, China should encourage the excess capacity of steel, copper, alumina and primary aluminum enterprises to transfer to those countries or areas with abundant resources, high energy matching degree and relatively excellent infrastructure. Based on the national conditions, mining condition and geopolitics of the resources countries, we will gradually build steel, copper, aluminum and lead‐zinc smelting bases, and potash processing and production bases, which will promote the excess capacity to transfer to the overseas orderly. (5) It is proposed to strengthen the planning and management of renewable resources recycling and to construct industrial base of renewable metal recycling. (6) China should promote the comprehensive development and utilization of paragenetic and associated mineral species to further improve the comprehensive utilization of bulk mineral resources.