MTECHTIPS;-Sentiments Supportive For Copper This Year

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MTECHTIPS;-Sentiments Supportive For Copper This Year

MTECHTIPS-Copper had one of it best years ever in 2017, rising 27% on the back of supply disruptions and steady demand from China, by far the largest copper consumer. In January last year a collection of analysts – BMI, Goldman Sachs, Citigroup and TD – were all bullish on copper, saying that after a terrible 2015 and 2016, it would be the strongest performing metal of 2017 with predictions of up to $6,200 a tonne come mid-year. By the end of 2017 copper futures trading on the London Metal Exchange (LME) were at their highest in four years, $7,236.50 a tonne or $3.28 a pound. Copper wasn’t the best performing metal of 2017 (that would be cobalt) but it was third behind palladium. Copper is one of the few metals that occur naturally in the earth’s crust as opposed to needing to be extracted from ore. According to the US Geological Survey (USES) 2.1 billion tonnes of copper resources have been identified throughout the world, with the most common deposit being porphyritic, representing 1.8 billion tonnes. By far the country with the most reserves is Chile, at 170 million tonnes, while Australia is second at 88 million tonnes and Peru a close third at 81 million tonnes. JORC-compliant reserves for Australia though are only about 24 million tonnes so really the top two copper depositories are Chile and Peru. The United States has 45 million tonnes of reserves, around the same as Mexico. On the demand side, copper consumption last year was driven by Chinese growth and expectations of US demand for copper based on statements from President-elect Donald Trump, who promised $1 trillion to help repair America’s crumbling infrastructure. Soon after Trump won the election in November 2016 the copper price rose nearly 2%. Copper demand growth in China for all the above-stated reasons is expected 

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