COPPER

Copper is of fundamental importance in a world increasingly reliant on efficient energy conduction. Copper’s highly conductive, ductile and anti-corrosive properties make it a vital component in modern economic development.

Renewable energy technologies are at the forefront of the energy revolution. Over the next five years to 2021, renewables are forecast to account for 60% of global energy capacity growth. This in turn will increase their market share in electricity generation from 23% in 2015 to 28% by 2021[1]. This is being driven by a shift toward low emission electricity generation and distribution and rapid advances renewable energy capture and storage technologies.

 

Copper market balance and price forecast[2]

Copper prices trended downwards from 2010 hitting multi-year lows in 2016 as a result of a surplus in supply. Future forecasts, however suggest that a supply deficit is likely, which may fuel a price resurgence over the coming years. In the short to mid-term, market prices are forecasted to rise above US$3.0/lb, as shown below. Globally, diminishing copper grades and exploration budgets mean that supply in coming years is unlikely to be adequate to keep pace with growing demand.

 

copper-chart

 

[1] International Energy Agency. 2016. ’Renewables: Medium-Term Market Forecast 2016.’ https://www.iea.org/media/news/2016/news/MTRMRInfographic.png

[2] Credit Suisse. 2017. https://www.credit-suisse.com/au/en.html