Charts: Copper Soars While Iron Ore Tumbles in 2024

Source : Bloomberg

Infographic: An Investor’s Guide to Copper in 3 Charts

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Source : Visual Capitalist

Chart: Copper’s Super-contango Sends Warning Signal Over Global Economy

Source : Bloomberg and Trading Economics

Chart: Copper Price and China GDP Forecast Diverge in 2023

Source : Knowledge Leaders Capital

Chart: Copper Reached an All Time High of US$4.90/lb in May 2021

Source : Trading Economics

Copper Future Prices Fell Below Scrap

Source : ZeroHedge and Trading Economics

Infographic: The Role of Copper in Renewable Energy

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Source : Visual Capitalist

Infographic: Copper’s Role in Renewable Energy

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Source : Visual Capitalist

How the Green Economy Will Be a Gold Mine for Copper

Copper reached an all time high of 4.90 in May of 2021

Andrew Bary wrote . . . . . . . . .

Copper, a linchpin of the old energy economy, will play a crucial role in the new green one, too. Cables made of the metal are still the most cost-effective means of transmitting electricity from solar and wind sources, and it is a key material in charging stations and the electric vehicles that use them. Indeed, Goldman Sachs analysts say, there is “no decarbonization without copper,” which they call “the new oil.”

Supplies, already tight as the global economy recovers, could be further strained by a predicted fivefold rise in green energy demand in the current decade, leading to significant shortages, starting in the mid-2020s, according to a report by Goldman commodity analyst Nicholas Snowdon. He sees copper, now around $4.50 a pound, hitting $6.80 by 2025. Bank of America commodity strategist Michael Widmer thinks the price could hit $6 this year.

Shares of copper producers, up sharply in the past year as the metal’s price has doubled from a post-Covid low, still have room to advance.

Freeport-McMoRan (FCX), with mines on three continents, is the top play and the S&P 500’s only major copper stock. Barron’s wrote favorably on copper and Freeport in January. Other notable producers are First Quantum Minerals (FQVLF) and Southern Copper (SCCO), 89% owned by the Mexican conglomerate Grupo Mexico (GMBXF).

The Global X Copper Miners exchange-traded fund (COPX) holds mining stocks, while the U.S. Copper Index fund (CPER) offers a direct play on the metal through ownership of futures contracts.

The main risk to copper is unexpected weakness in the global economy. China is critical; it accounts for about half of worldwide demand. However, a pullback seems unlikely, given that green power-related demand, just 3% of copper usage in 2020, could hit 16% by 2030, the Goldman analysts estimate.

An electric vehicle contains as much as 180 pounds of the red metal, four times the amount in an internal- combustion-engine vehicle. Onshore wind turbines use about four times as much copper as power plants fired by fossil fuels per megawatt of electricity. Offshore wind farms are even more copper-intensive; they need thick copper cables to transmit power onshore.

In commodity markets, higher prices normally elicit greater production, but copper might have to hit $6 a pound to convince miners to add new capacity, argues Jefferies analyst Chris LaFemina. “The supply constraints in copper are the worst they have ever been. Combine that with recovering demand, and you have a recipe for higher prices,” he says.

Copper mines annually produce about 21 million metric tons—about 45 billion pounds. Freeport noted last month that only 2 million metric tons of new annual supply are being developed. Miners are cautious after being burned when copper collapsed from a peak $4.70 a pound a decade ago. There are a limited number of good mining locations left worldwide, and lead times for new projects can stretch from six to eight years, due to permitting and environment reviews.

Source : Barron’s

Copper Futures Climbed Above the $4.7 per pound Mark for the First Time

Source : Trading Economics