King obsession for Gold/Copper bullish candle opportunityCopper giant Codelco has reduced its production for another quarter, although it is expected to improve its data for the second quarter. Yesterday's close in the UK saw all metals mining companies close the market higher ahead of the parliamentary elections which look very much on track for a possible Labour victory. Precious metals and industrial metals mining companies were among the gainers, rising between 4% and 2.4% respectively, in line with gold and copper prices.
If we look at the gold indicators, while in the West they are beginning to show signs of increasing indebtedness in people around 30 years old, associated with the problem of sovereign debt generated by the financing of wars and various subsidies. On the other hand, markets such as China and India have been major buyers of gold in the last decade, and have a problem of excessive accumulation of savings, forcing the Chinese government to promote measures to increase spending and increase indebtedness. The truth is that Asians continue to increase their gold accumulation and this will end up affecting the West sooner or later as the fiat currency is beginning to experience a slump and many Westerners have begun to make a weekly/monthly purchase of gold in entities like Costco (NASDAQ:COST) which hover around 200 million according to data from Wells Fargo bank, and this may be fueling the bonfire of the vanities of the highest quality gold and silver like Kitco which may be the big winners in all of this.
We have on the radar today's holiday in the US where the Non-Farm Payrolls to be released on Friday and according to employment data released yesterday, this data was worse than expected, and this has softened the view of hopes of extending the current monetary policy until September. While the climate of the U.S. jobs report is not expected to change gold too much other than reflecting possible declines, it will not have long-term relevance, because literally:
"EVERYONE IS OBSESSING ABOUT GETTING MORE GOLD."
If hostilities in the Middle East do not escalate it is possible that gold will continue to rise towards $2000-$2300 and silver towards $31-$35.
If we look at the chart a fairly clear bullish flag is forming in both gold and copper. Copper currently has a high of $519.75 which needs to be pierced. Having a target profit taking zone around $580 if the breakout is met. On the other hand the RSI is giving us an overbought signal at 67%. And the price bell marks the current price as a stability zone in a mono bell shaped curve with the $455 with the current strong price zone. This could signal that if the precondition is met, a pullback could be managed as it does not appear to have major strength at this time.
Ion Jauregui – ActivTrades Analyst
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The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and such should be considered a marketing communication.
All information has been prepared by ActivTrades ("AT"). The information does not contain a record of AT's prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acing on the information provided does so at their own risk.
HG1! trade ideas
COPPER : BULLISH REVERSAL - The market has been registering lower highs and lows for 6 weeks ; the short-term trend was then bearish.
- During that period, the market has evolved inside a bearish wedge pattern, a configuration that usually appears at the end of a bearish trend.
Indeed, this chart pattern is usually seen as the sign that sellers are becoming less and less powerful/numerous on the market, which tends to indicate a bullish reversal to come.
Very recently, we could have seen prices breaking-out of this bearish wedge pattern, confirming the bullish reversal scenario.
This move has also been supported by a bullish cross from both moving averages as well as the anticipated breakout on the RSI indicator.
- This is seen as a bullish reversal scenario, also supported by the prospect of a weaker US Dollar due to the incoming monetary easing cycle from the FED. The bearish wedge break-out has unlocked a new bullish potential towards $453.45, $466.15, $476.40, $486.65 and even above the $500 mark by extension.
Pierre Veyret, Technical Analyst at ActivTrades
The information provided does not constitute investment research. The material has no been prepared in accordance with the legal requirements designed to promote the independence of investment research and such is to be considered to be a marketing communication.
All information has been prepared by ActivTrades ("AT"). The information does not contain a record of AT's prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acing on the information provided does so at their own risk.
Is it possible that the price of copper will increase by up to 5If you would like to be notified whenever I post a new article, just click "FOLLOW" at the top. Also, if you would like to elaborate on a particular topic or need some advice, please comment below the article and I will be happy to help you.
Is it possible that the price of copper will increase by up to 50 percent in the next quarter?
Despite the initial rise in the price of copper futures in early May, we are now observing a moderate correction. However, there are several signs pointing to further demand growth and possible supply issues, suggesting that high copper prices will become the long-term norm from my perspective.
The electric vehicle industry is facing major challenges in the current environment due to rising prices of key metals such as copper.
Some crucial raw materials for the industry, such as nickel and lithium, may become more expensive in the future, further affecting the industry's costs.
A number of factors have contributed to the rise in copper prices in recent times. Among them, mining disruptions in Chile, Peru, Panama and Zambia have caused prices to soar. In addition, political developments could keep these levels high considering that demand will exceed supply in China for the next few years.
To discuss the global copper market, we need to consider two factors: ore production and refined copper production, which is the finished product that is traded on international exchanges.
In recent years, the mining sector has faced several problems. Most copper mining takes place in South America, with Chile and Peru as the main producers, but there are also other nations involved in production. However, episodes of political instability and environmental problems have caused a decline in the supply of minerals on the international market, especially in the countries of Chile and Peru.
In addition, another crisis recently occurred when one of the country's largest copper mines, located in Panama, closed permanently. This had a significant impact on the supply of copper ore internationally.
In contrast, there is the problem of refining. China is the leading country for refining, and with fewer ores available on the market, ore prices are steadily rising, putting a strain on Chinese refiners' profit margins. It is becoming increasingly difficult for them to make profits from refining.
In Chinese companies, there has been much discussion about a possible reduction in refining or an increase in control. There is also evidence to suggest that this cutback has already begun.
In recent times, the ore market has experienced some difficulty because of the Panama mine closure and Chinese discussions about refining. This has led to a degree of uncertainty about whether copper supply is sufficient to meet demand. In addition, the rapid transition of vehicles to electricity is also raising the prospect of increasing demand for this metal.
To fully understand the opportunities in the copper market, we will analyze the best companies in the industry. Usually, this requires the support of a financial advisor and incurs significant costs. However, thanks to TRADINGVIEW, you can access evaluations and analysis of companies in the sector for a small fee.
Using TRADINGVIEW, I performed an analysis on a major company active in the Copper industry. As shown in the image below, I gathered one crucial piece of data: the company has consistently exceeded analysts' forecasts, achieving higher profits and revenues than expected in the most recent quarterly financial statements.
Currently, Copper is in a good position in the market and I expect it to reach level 6 in the coming months with potential gains of 50 percent.
We look forward to seeing you in the next article! And remember, for successful trading always rely on TRADINGVIEW: an indispensable tool that can help you avoid serious mistakes during your trades.
Copper (HG1!) - Ideahey guys,
Yearly inside Bar - possible continuation of uptrend. 4.6400 is THE level to break on a Yearly close.
Quarterly: Bearish Candles with a long wick. --> Setup is Bearish
Monthly: A shooting star with a bearish Engulfing Candle. Stochastics Bearish -> at a yearly Key Level.
This confirms the Quarterly Bearish Bias …
Bearish Setup:
Sell at a valid Resistance level with a goal to retest the 4.000 and 3.5400 area.
Note: This bearish Setup will be invalid with a close above 4.4600 on the Monthly Chart.
Thanks for reading
Buy July copper at 501.40 limit, if filled stop at: 479.90, tgt Buy July copper at 501.40 limit, if filled stop at: 479.90, tgt at 518.80
COPPER / Expecting BreakoutCopper Chances to Break The Resistance Above 847 or Below 830 levels
There could be huge possibilities for Breakout Higher Or Lower Zone
AMP Futures - Watchlist, details, & news.In this video we will demonstrate how to navigate through your watchlist, details, and news, using Tradingview.
Copper's Short-Term Demand Woes, Long-Term GapsCopper is known as the electrifying metal.
Copper's warm glow and durable spirit, copper wires the heart of many a machine.
This reddish rarity has been super bullish in the recent past but less so now. That doesn't make it less investable. Just that nuanced investing approach is called for.
Outlook for copper has become mixed once more, with near term demand remaining downbeat given the continued slowdown in the Chinese property market and buildup in copper stock at SHFE. In the longer term, supply challenges risk pushing copper into a supply deficit with major copper miners Codelco and Anglo American facing supply challenges.
Given the mixed outlook, copper has continued to trade in a tighter price range over the past two months. Counter to conventional wisdom, a sideways market also presents opportunities for savvy investors. This paper describes the diverging outlook for the red metal and how investors can deploy a calendar spread using CME Micro Copper futures amid the diverging short and long-term outlook.
CHINESE COPPER INVENTORIES BUILD UP BECAUSE OF DEMAND SLOWDOWN
Chinese copper inventories have surged to one of their highest historical levels. Furthermore, inventories have been rising during the part of the year associated with drawdowns.
Source – Bloomberg
Lower demand is one of the factors behind the increasing inventories. The Chinese real estate sector is a major consumer of copper. With the ongoing slowdown in the sector, copper demand has been hit hard. Moreover, manufacturing sector in China is also experiencing a slowdown as China’s official manufacturing PMI dipped back into contraction in May.
Source: TradingEconomics
Combination of property market slowdown and lower industrial activity is hindering copper demand in the near term.
Furthermore, refined copper production among Chinese copper smelters has remained near all-time high levels over the past few months.
Source: Bloomberg
BULLISH SUPPLY SIDE AND INDUSTRIAL RECOVERY POSE UPSIDE TO COPPER
While near-term demand outlook may be downbeat, the medium- and long-term outlook for copper remain bullish. In the medium term, higher demand from the rapidly growing PV (photovoltaic) manufacturing and EV industry are absorbing some of the higher copper supply.
While both industries have slowed in recent months, analysts expect them to recover. At their current pace of copper consumption, these industries are more than compensating for the slowdown in the property market.
Source: Reuters
Additionally, major copper miners, Codelco and Anglo American are dealing with lower production.
Codelco, the world's largest copper producer, reported a 9.4% decline in production in the latest quarter compared to the previous year. This decline is attributed to falling ore grades, water restrictions, union protests, and logistical challenges exacerbated by the global situation, including the pandemic and geopolitical tensions. Anglo American also announced plans to reduce its copper production in 2024 as part of a strategy to cut costs and adapt to market conditions.
Lower output from major copper miners is a cause for concern given the rapid pace at which the new energy industries such as EVs and PVs are growing as well as the rapid growth in data centers which require substantial amount of copper. With inadequate supply, copper supplies face the risk of being pushed into a deficit.
ASSET MANAGERS HAVE REVERSED VIEW ON COPPER BULLISHNESS
While asset managers had built up substantial long positions during the sharp rally in copper which took price to an all-time high, they have started to close some of those long positions indicating that in the near-term price may have run ahead of themselves.
Source: CME QuikStrike
Over the past week, September CME options have seen a buildup in puts while calls have declined. The November contract has seen a similar trend. However, the March 2025 contract has seen a surge in call OI.
Source: CME QuikStrike
In a similar vein, CME copper future’s term structure has shifted from a steep contango to backwardation over the last three months. However, over the past week, this has started to shift once more as premium of later contracts over front month has started to rise leading to a steepening term structure.
HYPOTHETICAL TRADE SETUP
Given the diverging outlook for copper in the near-term and later term, investors can express a view on the shift in term structure using a calendar spread consisting of CME Micro Copper futures.
The below hypothetical trade setup consists of a long position in Micro Copper futures expiring in March 2025 (MHGH2025) and a short position in Micro Copper futures expiring in August 2024 (MHGQ2024).
Investors can also deploy the same trade setup using CME full-size copper futures. The CME full-size copper futures also provide a margin offset for the trade, a calendar spread with the same contract can be deployed with maintenance margin of USD 2,500 as of 24/June.
The below hypothetical trade setup provides a reward to risk ratio of 1.43x.
Entry: 1.011
Target: 1.055
Stop Loss: 0.98
Profit at Target: USD 492
Loss at Stop: USD 342
Reward to Risk: 1.43x
MARKET DATA
CME Real-time Market Data helps identify trading set-ups and express market views better. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com
DISCLAIMER
This case study is for educational purposes only and does not constitute investment recommendations or advice. Nor are they used to promote any specific products, or services.
Trading or investment ideas cited here are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management or trading under the market scenarios being discussed. Please read the FULL DISCLAIMER the link to which is provided in our profile description.
Copper: A Retracement Everyone Should Be WatchingDespite recent inflation slowdowns, we anticipate a new era where the consistent demand for raw commodities triggers temporary supply disruptions, potentially leading to significant returns for investors in tangible assets. While Crude Oil offers the broadest inflation protection and Gold protects against stagflation (rising inflation with declining economic growth ), Industrial Metals, such as Copper, provide a perfect mix in this new green energy era. Having the right mix of commodities in a diversified portfolio can help offer protection against a wide range of uncertainties.
The Demand Structure is Changing
There is a push for increased electric power use because the green energy revolution, rising EV Vehicle demand, and advancements in AI have all strained the out-of-date electrical grid. The combination pushes demand for copper, silver, and other metallic metals higher for the first time in a decade. That comes at a time when increased regulation makes it harder to bring on additional supply.
Taking it to the Charts
After a historical rise in the first half of 2024 fueled by excess speculation, open interest has recently declined to more normalized levels, leading to a 50% price correction from the February 9 low of $3.70/lb to the May 20 high of $5.19/lb. We see an attractive risk-reward dynamic using calculated options such as Bull Call spreads or outright call options to speculate on a price recovery. We firmly believe that a "Commodities Supercycle" is underway.
www.tradingview.com
CME Real-time Market Data help identify trading set-ups and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs
Disclaimers
*Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services.
Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.
Elliott Wave Analysis on Copper (HG) Expects the Metal Turning HShort Term Elliott Wave in Copper (HG) suggests the metal has ended wave (4) correction at 4.375. Wave (3) rally ended at 5.2 on 5.20.2024 which is all-time high price for Copper. Wave (4) pullback unfolded as a double three Elliott Wave structure. Down from wave (3), wave W ended at 4.7435 and wave X ended at 4.903. Wave Y lower subdivided into a zigzag structure where wave ((a)) ended at 4.571 and wave ((b)) ended at 4.696. The 45 minutes chart below shows wave ((b) on the left side of the chart.
Down from there, wave (i) ended at 4.518 and wave (ii) ended at 4.687. Wave (iii) lower ended at 4.431 and rally in wave (iv) ended at 4.612. Final leg wave (v) ended at 4.375. This completed wave ((c)) of Y of (4) in higher degree. The metal has turned higher and the rally looks impulsive. Up from 4.37, expect wave (i) to end soon, then it should pullback in wave (ii) to correct the short term rally from wave (4) before it resumes higher again. Near term, as far as pivot at 4.375 low stays intact, expect dips to find support in 3, 7, 11 swing for more upside.
What Declining Copper Price is telling us?From recent high to current close, copper prices have declined nearly 14%.
Copper is one of the most used elements in various industries and its declining price indicates decreasing demand which in turn indicates the slowing economy.
Historically, slump in copper prices precedes stock market correction and with valuations being so high, it is wiser to book your profits and sit on a pile of cash and wait for a good dip when you will be able to buy the same stocks you are holding now at cheaper price. However, no one can guess when the actual meltdown is going to start. So keep an eagle eye on your chart.
As for as Indian market is concerned, it is expected to follow global cues as of now and you might see a moderate gain in indices today. However, when Zeta Stock Scanner starts showing you more red stocks than green on daily chart, it would be time to book your profits and make an early exit.
For today, Grasim, Trent, GMRInfra, BEL, Titan and of course Mazdock seem to be all set to gain some more points.
Happy Trading.
AMP Futures - How to display volumeIn this video we will demonstrate how to display trading volume using the TradingView platform.
How to determine how far a correction will goTo assess the extent of a market correction, I examine the price action around Fibonacci retracement levels and use the RSI for additional confirmation.
On the Comex Copper futures chart, the market has executed a 50% retracement and bounced significantly from that level. The RSI has corrected its overbought condition and is attempting to stabilize around the 40 level. I am optimistic about a potential recovery from here but will need further confirmation from either the RSI or the price action.
The RSI could still fall and test the 30 level. At this stage, we cannot rule out a 61.8% retracement, though a 78.6% retracement seems unlikely given the current RSI position.
Disclaimer:
The information posted on Trading View is for informative purposes and is not intended to constitute advice in any form, including but not limited to investment, accounting, tax, legal or regulatory advice. The information therefore has no regard to the specific investment objectives, financial situation or particular needs of any specific recipient. Opinions expressed are our current opinions as of the date appearing on Trading View only. All illustrations, forecasts or hypothetical data are for illustrative purposes only. The Society of Technical Analysts Ltd does not make representation that the information provided is appropriate for use in all jurisdictions or by all Investors or other potential Investors. Parties are therefore responsible for compliance with applicable local laws and regulations. The Society of Technical Analysts will not be held liable for any loss or damage resulting directly or indirectly from the use of any information on this site.
Time to look at Copper longs againHaving rode the last leg higher in Copper nicely it has now pulled back into interesting levels again. If you are believer in the inflation trade (I am) then these sorts of pullbacks present decent opportunities to get back on board.
Long 4.53
Stop 4.28
Tgt 5.20+
Rtn/Risk 3:1
Copper mountain
All ideas are strictly my interpretation of price action. I am not a professional trader nor is this
professional advice.
Penny FlippingAll ideas are strictly my interpretation of price action. I am not a professional trader nor is this
professional advice.
COPPER Going well according to our long-term plan.Last time we looked at Copper (HG1!), we established our long-term strategy (April 19, see chart below), which involves a new Bull Cycle, through a Channel Up pattern similar to 2020 - 2021:
So far the plan goes flawlessly, as the price hit the top of the (green) Channel Up and is now pulling back. The 1W MA50 is about to complete a Golden Cross with the 1W MA200, the first one since January 11 2021!
On the shorter term (current chart on 1D) the price is approaching the 1D MA50 (blue trend-line), which is the short-term Support but as with last time, we expect it to marginally break before Copper bottoms and makes a new Higher Low on the long-term Channel Up.
To those who missed an early buy, we recommend entering once the 1D RSI hits its Support Zone. Our medium-term Target is 5.200 (Resistance 1).
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US Copper Futures Soar to Record HighsUS Copper Futures Soar to Record Highs
• Copper futures hit a new all-time high
• Renewable energy, electric cars, and AI bolster copper’s demand outlook
• The outlook for copper looks promising
Copper futures hit a new all-time high
Copper soared to a new record high, continuing a months-long rally fueled by financial investors who have entered the market expecting supply shortages.
Copper prices have been soaring since the beginning of this year, rising by 29% year-to-date. Copper futures at COMEX traded at $5 per pound as of 15 May, marking the highest level since March 2022, when the base metal's price reached an all-time high.
The global copper market is experiencing significant turmoil due to a substantial squeeze in the New York market, where prices hit an all-time high last week.
The short squeeze caused prices on the Comex exchange to reach an unprecedented premium over the LME, prompting a scramble to redirect metal supplies to the US.
Renewable energy, electric cars, and AI bolster copper’s demand outlook
Copper prices have surged recently due to increasing optimism regarding lower interest rates and stimulus measures from top importer China. Additionally, expectations of tighter supplies, resulting from production cuts in China and stricter sanctions on Russian metal exports, have driven buying interest in copper.
This surge in copper prices is primarily driven by its crucial role in growing industries, including electronic vehicles and AI chip manufacturing. This growing demand is particularly pronounced in China, whose economy is still regaining momentum in these key industries. Demand is outpacing new supply for now, furthering the rapid rise in futures prices.
The Chinese market is expected to see inventories withdrawal soon with exports rising," Gong Ming, an analyst with Jinrui Futures Co, said to Bloomberg.
Outlook for copper looks promising
According to S&P Global: "Copper prices are anticipated to ascend in the long term as a result of the clean energy transition, notwithstanding prevailing short-term apprehensions." The organization forecasts that copper demand will double, reaching 50 million metric tons by 2035. The most significant demands are expected to emanate from the US, China, Europe, and India.
According to Statista, total copper mine production amounted to approximately 22 million metric tons in 2023, up from 16 million metric tons in 2010. Projected growth suggests that worldwide production will reach 30 million metric tons by 2036, assuming production continues at the same pace. However, this projected increase falls significantly short of the anticipated surge in demand.
Meanwhile, the copper mining industry is set for a slowdown in the upcoming year. A report by Goldman Sachs indicated that investment in mining companies in 2022 was nearly 50% lower than the expenditure in 2010. Disruptions in copper mines, often occurring in Latin America, could result in a widening deficit in copper supply from 2024 onwards.
Africa the new Chinese Copper ColonyThis day has seen the price differential between the COMEX and the London Metal Exchange (LME) seen as a support for the consolidation of the UK market. The copper market has been experiencing tensions due in part to the closure of one of the most important mines in Latin America located in Panama, coupled with the reduction of production forecasts from several suppliers. China's focus on lending, investment and trade with Africa as a whole has generated a beneficial exchange in which billions of dollars have been committed to construction projects led by President Xi's Silk Road initiative. Chinese investments in Africa increased by 114% according to Australia's Griffith University, where their focus is highly concentrated on extracting minerals for the energy transition and China's plans to lead and revive its own economy. Such trade also requires oil, agricultural and manufacturing products, as China's deficit has ballooned. Public-private infrastructure development (PPP) loan agreements appear to be China's channel for acquiring raw materials in exchange for finished goods.
Recently, the American Enterprise Institute, a Washington think tank, reported that investments from 2023 to 2025 have been increasing to $11 billion, of which $7.8 billion went into mining, such as the Khoemacau copper mine in Bostwana, which China's MMG Ltd acquired for $1.9 billion, as well as lithium and cobalt mines in countries such as Namibia, Zambia and Zimbabwe. The hunt for critical minerals has also extended to the Democratic Republic of Congo (DRC), where the Chinese government is developing the Atlantic coast corridor called the Lobito Corridor, to send metals from Zambia to Congo, the development of the Nairboi Expressway, the development of automobile tracks in Kenya or the railroad line that was cancelled in Uganda. What can be detected in the Chinese economic model is the generation of a hyperdependence of “colony-metropolis” that was previously occurring with European countries such as France, or the United States in those countries, and this control of monetary power is being transferred to China.
Looking at the July copper futures chart, there has been a gradual escalation in price since February, where major African contracts with China through the BRICs began to be backed by Gold and intensified, and this forced the repatriation of millions of dollars sitting in fort nox bunkers and respective domestic warehouses in the US.
It would not be unusual to see a price contraction to previous areas of 383 because the demand for copper has been able to match pure speculation prices of 2022, where there is no real demand to cover that supply, because none of the technology consuming countries are at their best. This, added to the inflation problem, may be affecting and causing copper to remain bullish, just like the rest of the metals. But not because of real market demand, but because of inflation. Its high of 519.75 could be pierced again because of inflation, but as soon as inflation is corrected if market demand remains as poor, copper will fall in price to plummeting lows. In any case, a bullish continuation is very feasible in the short term.
Ion Jauregui - AT analyst
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The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and such should be considered a marketing communication.
All information has been prepared by ActivTrades ("AT"). The information does not contain a record of AT's prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acing on the information provided does so at their own risk.
Copper: The Next Big Boom - Prices Could Skyrocket to $40,000Hedge fund manager Pierre Andurand predicts that copper prices could surge to $40,000 per tonne in the coming years due to soaring demand. Currently priced at around $11,000 per tonne, copper has already seen a 20% increase this year. The demand is driven by the electrification of various sectors, including electric vehicles, renewable energy sources, military uses, and data centers.
Andurand, who manages approximately $2 billion in assets at Andurand Capital, forecasts this dramatic rise based on the doubling of demand growth for copper. He acknowledges that although a supply response is expected, it will take more than five years to materialize. This sentiment is echoed by former Goldman Sachs executive Jeff Currie, who also predicts significant price increases, albeit to a more conservative $15,000 per tonne.
The transport sector's copper demand is projected to grow over 11 times by 2050, with electric vehicles alone requiring substantial amounts of copper wiring. Additionally, the expansion of the global electricity grid will necessitate a 4.8-fold increase in copper demand by 2050.
The copper supply gap is projected to reach 10 million tonnes by 2030, as per BloombergNEF estimates. Despite not being widely known in the US, Andurand has a solid track record in commodities trading, with his funds experiencing an 83% increase in value this year.
The rising copper prices reflect broader trends in the metals market, driven by strong demand and historically low inventories. Significant growth in copper demand is also anticipated from developing countries, particularly China, India, and Indonesia, which are experiencing exponential increases in consumption.
