Copper

[JohnDe]

Is copper the cannery in the mine for the world economy? Nice increase overnight, if it wasn't for the issues with Russia, inflation and news of a major recession, I'd say that things must be looking up with copper demand increasing for world production demands. I might buy some, then again....

Good luck to those picking when the cannery is happy or euphoric from lack of oxygen.

 

[KevinBB]

Is copper the cannery in the mine for the world economy? Nice increase overnight, if it wasn't for the issues with Russia, inflation and news of a major recession, I'd say that thing must be looking up with copper demand increasing for world production demands.

Hi @JohnDe - you may well be right, but I think that Wednesday night's move was more to do with the movement in the USD following the UK central bank's intervention in the markets. All the commodities I trade, including copper, gained substantially during the session, so I really don't think there was a change in the fundamental views of traders.

I've seen articles in the past few days about copper supply, and the time it takes to get new production up and running. Maybe they are right, so I need to go looking for Aussie copper stocks. We'll see.

KH

 

[KevinBB]

Hello again @JohnDe - It turns out your charts were right. Nice intra-day move in copper during the Australian night.

I'm still short, system looks back a bit longer than one day.

KH

 

[greggles]

Some more bullish news for copper. European copper buyers will be paying record premiums in 2023 due to Russian copper being subject to sanctions. A substantial supply gap is expected next year due to the amount of Russian copper that is usually imported into Europe.

Record European copper premiums as buyers shut out Russia

European copper buyers are going to be paying a lot more to get their metal next year.

www.reuters.com

 

[peter2]

I remain a copper bull but understand that I may have to wait a while. China growth has stalled, LME stockpiles are rising and the POC is drifting lower. POC will rally again though.

 

[divs4ever]

I remain a copper bull but understand that I may have to wait a while. China growth has stalled, LME stockpiles are rising and the POC is drifting lower. POC will rally again though.

but why are LME stock-piles rising ??

( the obvious potential reasons , 1. China has stopped buying through the LME , 2. manufacturing in Europe is entering a death spiral )

the West want green , but also want the world to make it so without EU pain , that sounds like a recipe for disappointment to me

 

[greggles]

but why are LME stock-piles rising ??

From the article I linked to above:

The dependence on Russian metal is compounded by the composition of LME stocks. The LME's discussion paper showed that over 60% of available copper stocks in its warehouse system at the end of September were Russian brand.

Europe is heavily dependent on Russian copper so they will have to start sourcing the metal from alternate sources.

 

[divs4ever]

From the article I linked to above:



Europe is heavily dependent on Russian copper so they will have to start sourcing the metal from alternate sources.

alternatives to Russia , that is going to hurt ( most other nations are facing rising energy costs )

and in the euro continues to slide , so doubly so

interesting times ahead , this might be the Asian Century (especially in the Middle East moves in that direction)

 

[Sean K]

This potential global recession has stalled copper, but if you've got a medium term view, the current situation with copper plays represents an amazing opportunity. Just have to be capable of withstanding some significant short term DD, I guess. Or, you're short term trading. Or, a combo of both.

 

[peter2]

I agree with the promising outlook for copper but also realise that this potential demand for copper has been delayed by 6-12 months.

 

[divs4ever]

I agree with the promising outlook for copper but also realise that this potential demand for copper has been delayed by 6-12 months.

i am thinking the delay will be longer , but i have a very nice position in OZL ( unless BHP ruins the party ) and hold AIS which i don't expect to have taxable profits within the next two years

good luck

 

[noirua]

 

[Dona Ferentes]

There is a new ASX listed ETF, developed in Nov 2022, that claims it is a pureplay index for global copper miners:

WIRE - GlobalX Copper Miners ETF

Global X Copper Miners ETF (WIRE) This is a new ETF established as a pureplay exposure to copper miners; just launched on 23 November, so there is no track record and AUM is very low at the outset. Base seeding price is $10 a unit. Management fees set at 0.65%pa WIRE provides access to a...

www.aussiestockforums.com

also found on this WIRE thread (item #2) is a useful backgrounder:

Why the World Can’t Cope without Copper ​

By Global X ETFs Australia

 

[greggles]

Glencore sees huge copper deficit in 2023 and beyond. Mine development is lagging demand in a big way and a supply crunch is coming.

Mining Giant Glencore Sees Huge Deficit In Copper Coming | OilPrice.com

A huge shortage of copper is looming, mining and commodities giant Glencore said in an investor update this week

oilprice.com

 

[Sean K]

Glencore sees huge copper deficit in 2023 and beyond. Mine development is lagging demand in a big way and a supply crunch is coming.

Mining Giant Glencore Sees Huge Deficit In Copper Coming | OilPrice.com

A huge shortage of copper is looming, mining and commodities giant Glencore said in an investor update this week

oilprice.com

Unless there's another huge copper discovery or two in the next couple of years, or things like Oak Flat in Arizona gets approved and in operation very quickly (it won't), the price of copper is going to go nuts and marginal operations now will become very valuable.

Unless there's another metal or a tech solution to copper use?

 

[qldfrog]

Unless there's another huge copper discovery or two in the next couple of years, or things like Oak Flat in Arizona gets approved and in operation very quickly (it won't), the price of copper is going to go nuts and marginal operations now will become very valuable.

Unless there's another metal or a tech solution to copper use?

or unless a major depression/conflict reset the clocks and priorities but you are probably right, the west will go for this carbon zero scam as if it was the new bitcoin or black tulip until full societal collapse ?

 

[qldfrog]

or unless a major depression/conflict reset the clocks and priorities but you are probably right, the west will go for this carbon zero scam as if it was the new bitcoin or black tulip until full societal collapse ?

I actually expect miners to do kind of relatively ok next year while the economic recession hits the world..so does that means australia will do ok?

 

[Sean K]

or unless a major depression/conflict reset the clocks and priorities but you are probably right, the west will go for this carbon zero scam as if it was the new bitcoin or black tulip until full societal collapse ?

Yes, this is the biggest risk perhaps. Recession/depression, Ukraine/Russia spills over, and China invade Taiwan at the same time, then God knows what happens with the World economy and demand then. Fingers crossed the World navigates a path through this.

 

[Smurf1976]

Unless there's another metal or a tech solution to copper use?

There are but generally with a downside.

Aluminium's an alternative for electrical cables for example. It's actually used in the case of transmission lines, copper would be far too costly, but whilst it's referenced in the relevant Standards I've never seen or heard of anyone wiring a house with aluminium wire. In theory yes, in practice not that I'm aware of.

Plumbing pipes can be replaced with plastic alternatives in many but not all situations and to considerable extent that's already done.

Copper's long gone as a material for most water tanks and has been so since the 1970's. Hot water tanks used to be copper but not anymore. I've seen corrugated copper water tanks made a long time ago - looked just like a corrugated galvanised iron tank that you'd see on a farm etc but they were definitely copper. Must be worth a fortune.

My observation is that the low hanging fruit for alternative materials, things like transmission lines, pipes, tanks etc has mostly already been picked. Those uses have already shifted away from copper largely and what remains is much more difficult.

 

[orr]

On copper as a conductor; the more amps the more copper you need, the more volts the less amps, therefore the less copper for the same amount of power .
Higher voltage archtecture for EV's means for the same power for less amps.
And to this end; a good look at silicon carbide power eletornics are worth a look at. This, Si-carbide, I believe will only increase across industry more broadly.
A bit more esoteric but applicable is the physics of electric motors is rpm and what a carbon wrapped rotor has an advantage with regard efficiency
Elevated cost of copper will drive these type developments faster.

Gone are the days of low-voltage tungsten filiment down lights with their associated transformers in their dozens gobbling up rediculious amounts of elecrticity turning it into unwanted heat that would then add to air-conditions costs... being a thing.