Good morning,
Have been numerous articles published on copper. Quite abit said, overall, for mine the message is positive. Note the contents of greggles post on 9 December 2022, re Glencore. This article is encapsulated also into the below AFR publication.
rcw1 holding NCM.
CNBC - 13/12/22 - Copper prices — traditionally a barometer for the global economy — are expected to soar next year
The downward pressure in 2022 stemmed in part from persistent market expectations for a surplus inflection in the metal market, driven by anticipation of sluggish demand amid slowing global growth and an acceleration of mining activity, Goldman Sachs strategists said in a note last week. However, this has not come to fruition ...
The AFR published this article not so long ago. There are a number of take-aways from a pretty well written story for mine.
Not quite sure though on the extent of overall impact of green demand projects upon the copper market.
Alex Gluyas Markets reporter
Dec 7, 2022 – 12.08pm
Copper prices will rocket to record levels in the next 12 months, according to Goldman Sachs, as a looming supply shortage coincides with growing demand, keeping the physical market for the metal in deficit in 2023. That bullish view appears to be shared by Glencore boss Gary Nagle, who predicted “a huge deficit” coming in copper. Copper prices snapped a streak of seven months of losses in November. Bloombergm While some traders had been anticipating that a burst of new supply would temporarily weaken market fundamentals near-term, Goldman Sachs believes this soft patch is failing to materialise. The broker now forecasts that the copper market faces a 178,000 tonne deficit next year, compared to its previous forecast for a 169,000 tonne surplus.
“The sequential increase in policy targets and commitments to green transition, alongside a minimal supply response so far... have resulted in earlier and larger open-ended deficit conditions that essentially are already here, not beginning at some point in the future,” said Nicholas Snowdon, metals strategist at Goldman Sachs.
The price of the industrial metal, used in everything from electric vehicles to power infrastructure, has dropped 22.5 per cent from a record high of $US10,845 a tonne in March amid persistent recession fears, a stronger US dollar and the slowdown caused by China’s strict COVID-19 measures.
But in November, the metal recorded its biggest monthly advance since April 2021, surging nearly 11 per cent on the London Metal Exchange as China began loosening virus restrictions.
The clearer path to a recovery in the world’s largest copper importer means the metal is near its trough, and next year presents a more supportive macroeconomic backdrop, Mr Snowdon said.
Goldman Sachs forecast that prices will exceed their record high in the next year, increasing its 12-month price target to $US11,000 a tonne from $US9000 a tonne.
The new target implies 31 per cent upside from copper’s current price of $US8405 a tonne.
The expectation of tighter market conditions reflects Goldman’s 434,000 tonne cut to its global mine supply forecasts for next year, which was largely due to lower guidance from operations in Chile. The broker also increased its China green demand projection by 250,000 tonnes after analysts updated their expectations for installations of solar panels next year. Goldman is anticipating that China will accelerate its restocking of copper as the nation ramps up toward a post-COVID-19 reopening, and introduces measures to stabilise its troubled property sector.
With global visible copper inventories set to end this year below 200,000 tonnes, “another deficit in the market next year will take fundamental conditions to an unprecedented extreme in terms of tightness,” Mr Snowdon said.
Goldman Sachs upgraded its average price forecast for 2023 to $US9750 per tonne, from $US8325 per tonne previously. The broker now expects prices to average $US12,000 a tonne in 2024, from $US10,750 a tonne previously.
Edit: just a tidy up of a sentence.
Kind regard
rcw1
Have been numerous articles published on copper. Quite abit said, overall, for mine the message is positive. Note the contents of greggles post on 9 December 2022, re Glencore. This article is encapsulated also into the below AFR publication.
rcw1 holding NCM.
CNBC - 13/12/22 - Copper prices — traditionally a barometer for the global economy — are expected to soar next year
MSN
www.msn.com
The downward pressure in 2022 stemmed in part from persistent market expectations for a surplus inflection in the metal market, driven by anticipation of sluggish demand amid slowing global growth and an acceleration of mining activity, Goldman Sachs strategists said in a note last week. However, this has not come to fruition ...
The AFR published this article not so long ago. There are a number of take-aways from a pretty well written story for mine.
Not quite sure though on the extent of overall impact of green demand projects upon the copper market.
‘Extremely’ tight market to fuel record copper prices next year
Alex Gluyas Markets reporter
Dec 7, 2022 – 12.08pm
Copper prices will rocket to record levels in the next 12 months, according to Goldman Sachs, as a looming supply shortage coincides with growing demand, keeping the physical market for the metal in deficit in 2023. That bullish view appears to be shared by Glencore boss Gary Nagle, who predicted “a huge deficit” coming in copper. Copper prices snapped a streak of seven months of losses in November. Bloombergm While some traders had been anticipating that a burst of new supply would temporarily weaken market fundamentals near-term, Goldman Sachs believes this soft patch is failing to materialise. The broker now forecasts that the copper market faces a 178,000 tonne deficit next year, compared to its previous forecast for a 169,000 tonne surplus.
“The sequential increase in policy targets and commitments to green transition, alongside a minimal supply response so far... have resulted in earlier and larger open-ended deficit conditions that essentially are already here, not beginning at some point in the future,” said Nicholas Snowdon, metals strategist at Goldman Sachs.
The price of the industrial metal, used in everything from electric vehicles to power infrastructure, has dropped 22.5 per cent from a record high of $US10,845 a tonne in March amid persistent recession fears, a stronger US dollar and the slowdown caused by China’s strict COVID-19 measures.
But in November, the metal recorded its biggest monthly advance since April 2021, surging nearly 11 per cent on the London Metal Exchange as China began loosening virus restrictions.
The clearer path to a recovery in the world’s largest copper importer means the metal is near its trough, and next year presents a more supportive macroeconomic backdrop, Mr Snowdon said.
Goldman Sachs forecast that prices will exceed their record high in the next year, increasing its 12-month price target to $US11,000 a tonne from $US9000 a tonne.
The new target implies 31 per cent upside from copper’s current price of $US8405 a tonne.
The expectation of tighter market conditions reflects Goldman’s 434,000 tonne cut to its global mine supply forecasts for next year, which was largely due to lower guidance from operations in Chile. The broker also increased its China green demand projection by 250,000 tonnes after analysts updated their expectations for installations of solar panels next year. Goldman is anticipating that China will accelerate its restocking of copper as the nation ramps up toward a post-COVID-19 reopening, and introduces measures to stabilise its troubled property sector.
With global visible copper inventories set to end this year below 200,000 tonnes, “another deficit in the market next year will take fundamental conditions to an unprecedented extreme in terms of tightness,” Mr Snowdon said.
Goldman Sachs upgraded its average price forecast for 2023 to $US9750 per tonne, from $US8325 per tonne previously. The broker now expects prices to average $US12,000 a tonne in 2024, from $US10,750 a tonne previously.
‘Huge deficit’ looming
Glencore, one of the world’s largest copper producers, overnight echoed predictions that the copper market is facing an imminent supply shortage. “There’s a huge deficit coming in copper, and as much as people write about it, the price is not yet reflecting it,” its chief executive Mr Nagle said. Mr Nagle added that Glencore will wait to lift its copper production until the world is “screaming” for it, according to comments reported by Bloomberg. “We want to see that deficit,” Mr Nagle said. Glencore could lift its annual copper output by more than 60 per cent from current levels of 1 million tonnes by expanding its current assets, Mr Nagle said.Edit: just a tidy up of a sentence.
Kind regard
rcw1
