Copper topped US$10,000 per tonne for the first time since 2011, nearing the all-time high set that year as rebounding economies stoke demand and mines struggle to keep up.
Prices rose as much as 1.3 percent to US$10,008 per tonne on the London Metal Exchange, before slipping back to trade near unchanged. The metal hit a record US$10,190 in February 2011.
Copper was among the best performers last month, when metals from aluminum to iron ore surged to the highest in years.
The rally is being fueled by stimulus measures, near-zero interest rates and signs that economies are recovering from the COVID-19 pandemic.
A push toward cleaner energy sources is also seen boosting consumption of copper, used in everything from electric vehicles to solar power systems, further straining supplies.
“This is a remarkable run for copper in terms of magnitude and consistency,” said Tai Wong, head of metals derivatives trading at BMO Capital Markets. “The all-time high at [US]$10,190 is just around corner and now practically a foregone conclusion.”
Investors have piled into copper, with aggregate open interest in Shanghai Futures Exchange copper contracts at the highest in more than a year and hedge fund managers boosting bullish Comex copper bets in the week ended on Tuesday last week.
With copper demand set to soar once more, there are mounting concerns that producers will struggle to plug the gap as they battle a host of technical and regulatory pressures. In the longer term, producers worry that plans to boost mining royalties could stifle investment.
Prices have doubled from lows in March, along with a surge across raw materials from oil to agriculture.
That is spurring debate about whether the current boom might herald a so-called commodities supercycle.
“The copper price has gone stratospheric and probably has further to go, which is a boon for miners who are currently making at least two dollars for every one they spend getting metal out of the ground,” CRU Group base metals principal analyst Robert Edwards said.
Copper pared earlier gains as the US dollar advanced, reducing the appeal of the metal for investors holding other currencies.
For the day, the metal rose 0.1 percent to settle at US$9,885 per tonne on the London Metals Exchange.
Other metals were mixed in London, with aluminum climbing to a three-year high and nickel falling.
“The copper rally still has legs to go,” ING Bank senior commodities strategist Wenyu Yao said. “The outlook for the US economy keeps getting better. Economic reopening coupled with massive stimulus, faster-than-expected vaccine rollouts and supportive fundamentals all point to even higher prices.”
With copper prices nearing record highs, Newmont Corp, the world’s largest gold producer, is looking to increase output of the metal through several “mega projects,” Newmont chief executive officer Tom Palmer said on an earnings call on Thursday.
Even if just one materializes, copper would account for 15 to 20 percent of the company’s total output by the end of the decade, he Palmer said.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday said its materials management head, Vanessa Lee (李文如), had tendered her resignation for personal reasons. The personnel adjustment takes effect tomorrow, TSMC said in a statement. The latest development came one month after Lee reportedly took leave from the middle of last month. Cliff Hou (侯永清), senior vice president and deputy cochief operating officer, is to concurrently take on the role of head of the materials management division, which has been under his supervision, TSMC said. Lee, who joined TSMC in 2022, was appointed senior director of materials management and
Nvidia Corp CEO Jensen Huang (黃仁勳) on Thursday met with US President Donald Trump at the White House, days before a planned trip to China by the head of the world’s most valuable chipmaker, people familiar with the matter said. Details of what the two men discussed were not immediately available, and the people familiar with the meeting declined to elaborate on the agenda. Spokespeople for the White House had no immediate comment. Nvidia declined to comment. Nvidia’s CEO has been vocal about the need for US companies to access the world’s largest semiconductor market and is a frequent visitor to China.
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