While there have been some…
It is set to be…
Robert Friedland, billionaire mining investor and founder of Canadian mining company Ivanhoe Mines, is unconcerned with the recent plunge in copper prices as medium and long-term demand for the metal is set to soar.
Copper prices fell below the threshold of $8,000 per ton on Wednesday, as underwhelming Chinese economic data has weighed on the market and investor sentiment. In May alone, copper prices have fallen by 8% so far, while money managers have turned increasingly bearish on copper in recent weeks. For the first time since the height of the pandemic in 2020, the number of short positions on copper on the London Metal Exchange now exceeds the longs.
Yet, billionaire Friedland, as well as Goldman Sachs and major commodity trading groups, continue to be bullish on copper beyond the near-term weakness.
"It's momentary," Friedland told Bloomberg TV in an interview this week, commenting on the copper price plunge.
"We're very very bullish on demand," he added.
A supply crisis in the copper market is looming, according to Friedland, who thinks there is not enough new production to meet future demand for one of the key metals for the energy transition.
Copper prices are likely to hit a record high in the next 12 months, commodity trading major Trafigura said earlier this year, citing the rebound in China's economy and short supply.
According to Trafigura's co-head of metals and minerals Kostas Bintas, the price could rise to its previous record of $10,845 per ton and even top it to trade at $12,000 per ton.
"I think it's very likely in the next 12 months that we will see a new high," Bintas said at the FT Commodity Global Summit. "What's the price of something the whole world needs but we don't have any of?"
At the World Economic Forum in January, Trafigura's chief executive Jeremy Weir said, "If we want to reach net zero by 2050, we need to have two-thirds of energy from renewable sources by 2030. In that scenario, we need a 20% increase in production per annum of copper."
By Charles Kennedy for Oilprice.com
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Charles is a writer for Oilprice.com
Plus Putin Russia War now too all Super Bearish and not just for copper although certainly there is that.
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