Money Control Place
  • Politics
  • Business
  • Stocks
  • Investing
  • Politics
  • Business
  • Stocks
  • Investing

Money Control Place

Investing

Copper Prices Hit 22 Month High as Supply Concerns Mount

by April 12, 2024
April 12, 2024
Copper Prices Hit 22 Month High as Supply Concerns Mount

Copper prices hit a nearly two year high this week, and according to analystsat investment bank Citigroup (NYSE:C) that’s a sign the red metal has entered its second secular bull market of the century.

Over the past two months, copper has surged by more than 15.75 percent, fueled by disruptions at mining operations that have threatened refined copper production in China, a major global supplier.

“The recent disruptions to major mines are starting to ripple through the industry,” said strategist Daniel Hynes of Melbourne’s ANZ Bank. “A group of 13 major copper smelters in China is preparing for a possible 10 percent production cut due to a collapse in treatment and refining charges.”

In an article published on Thursday (April 11), Warren Patterson and Ewa Manthey of research firm ING said they believe copper’s price move can be attributed to a global supply deficit.

“The main catalyst for copper’s rally is the unexpected tightening in the global mine supply, most notably First Quantum’s (TSX:FM,OTC Pink:FQVLF) mine in Panama, which has removed around 4,000,000 tonnes of the metal from the world’s annual supply,’ they wrote. The Cobre Panama mine was forced to shut its doors at the end of 2023.

Copper’s 2024 price performance.

Chart via the London Metal Exchange.

“In addition, Anglo American (LSE:AAL,OTCQX:AAUKF), said it was cutting output by 200,000 tonnes. And Codelco, the world’s biggest copper producer, is struggling to recover from the lowest output in a quarter of a century,” they added.

Analysts at Bank of America (NYSE:BAC) also believe copper supply is at risk, citing a lack of new mines. The firm recently raised its 2024 price target to US$9,321 per metric ton (MT), up from its previous forecast of US$8,625.

On the demand side, China’s economic recovery is adding fuel to the fire. Positive signs like a strong Purchasing Managers’ Index and rising exports are raising hopes for a renewed surge in Chinese copper demand.

During the 2000s bull market, copper prices leaped more than fivefold in three years on the back of rapid urbanization and industrialization in the Asian nation. Analysts suggest a similar trend could unfold over the next three years.

Other base metals, including zinc, have also experienced gains amid concerns over Chinese refined output risks.

Exploration challenges threaten future copper supply

Copper supply woes are not a new issue — decades-old problems are behind the growing shortfall.

Declining exploration spending has disproportionately impacted junior mining companies. These companies, which are vital for early stage discovery, witnessed an 8 percent drop in exploration expenditures in 2023.

Junior explorers play a key role in finding new copper deposits, but lack of investment makes it difficult for them to secure funding for the high-risk, high-reward projects needed to identify the next generation of copper mines.

While overall copper exploration funding saw a 12 percent increase last year, the majority of these investments — around US$3.12 billion — went toward existing or near-production assets instead of discovery.

Copper’s positive price fundamentals have prompted analysts to anticipate further increases in the coming months.

As of 9:57 a.m. EDT on Thursday (April 11) copper was trading at US$9,374 on the London Metal Exchange.

Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.

This post appeared first on investingnews.com
0
FacebookTwitterGoogle +Pinterest
previous post
5 Largest Cobalt Mines in the World (Updated 2024)
next post
FBI Director Christopher Wray cites increased foreign threats in FISA reauthorization plea: ‘Rogue’s gallery’

Related Posts

Lode Gold Engages Strategic Advisors to Advance Development...

June 25, 2025

Cardiol Therapeutics Announces it has Exceeded 50% Enrollment...

January 10, 2024

Nevada Organic Phosphate

September 13, 2023

5 Top Weekly TSXV Stocks: Dynasty Gold Up...

June 27, 2023

Alamos Gold to Acquire Argonaut Gold in US$325...

April 3, 2024

11 Lithium Stocks Betting on Direct Lithium Extraction

August 24, 2023

Appia Announces Appointment of Mr. Andre Costa as...

April 24, 2024

DoD Invests US$400 Million in Rare Earth Firm...

July 12, 2025

Top 5 Canadian Mining Stocks This Week: Carlton...

September 6, 2025

Crypto Market Recap: Circle, Klarna and Chime May...

April 5, 2025

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Latest

    • S&P 500 Breaking Out Again: What This Means for Your Portfolio

    • Lithium Market Update: Q3 2025 in Review

    • Despatch of SPP Offer Documents

    • Crypto Market Update: FalconX to Buy 21Shares, Senate Democrats Call Out Trump Envoy

    • Apollo Silver

    • Blackrock Silver Commences Phase 2 Hydrology Program, Geotechnical Evaluation and Seismic Survey on the Tonopah West Project

    Categories

    • Business (1,401)
    • Investing (3,062)
    • Politics (3,699)
    • Stocks (1,828)
    • Uncategorized (20)
    • About us
    • Contact us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: MoneyControlPlace.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 moneycontrolplace.com | All Rights Reserved