22-Month Peak Attained by Copper and There’s a Bullish Outlook for $12K by 2026

The copper market is going through something unusual where there’s a high demand for semi-processed copper ore.

People who trade this ore and those who melt it down are paying about the same price for it as they would for already processed copper.

Copper market tight: traders pay the same for ore as processed, indicating immediate supply shortage.

This means there’s not enough copper ready to use right away. Craig Lang from CRU Group says this shortage of raw materials is making copper prices go up, which is good for people who have copper or invest in it.

Upbeat Predictions and Increased Investments In Copper

Investors are feeling optimistic about copper, so they’re investing more in copper-related things on the London Metal Exchange. This surge in investment is the biggest it’s been since at least 2018.

Even though copper prices are at a 22-month high, there are still worries about lower demand for already processed copper, especially in China where there’s a lot of copper stored up and the prices aren’t as high.

Demand hopes: US and China economic data boost expectations, fueling copper price rise. (Credits: iStock)

But because there’s a big demand for semi-processed copper ore, experts think copper prices will keep going up. Citigroup Inc. even predicts that by late 2024, the average copper price will be $10,000 a ton, and by 2026, it could reach $12,000.

What Are The Risks in Supply and Hopes For Demand In It?

The shortage of copper ore is getting worse because some copper mines are having problems making enough.

Supply risks: mine closures worsen ore squeeze, leading to record-low refining charges.

For example, First Quantum Minerals Ltd.’s Cobre Panama mine shut down, and other big copper producers are making less.

This has caused the prices for treating and refining copper to drop to their lowest ever, with some traders even paying extra.

Even though more places can melt copper, if new projects don’t start on time and there are more production problems, the market could get even tighter. Recent economic news from the US and China makes people think there will be more demand for copper, which is helping to push prices up.

Sajda Parveen
Sajda Parveen
Sajda Praveen is a market expert. She has over 6 years of experience in the field and she shares her expertise with readers. You can reach out to her at [email protected]
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