Copper has jumped about 18% this quarter, and it has averaged above $8,475/t so far this year with a high of $9,605/t back in late-February. However, recent disruptions and pending structural deficits will not be enough to keep the metal used in the manufacturing of various goods ranging from autos to electronics bid, Bart Melek, Head of Commodity Strategy at TD Securities, briefs.
Key quotes
“The rally seems to have been driven by an influx of speculative interest amid expectations demand will surge due to copper’s longer-term green-focused demand and the post-covid recovery, rather than the current fundamentals.”
“The reversal of temporary supply disruptions, along with spec long liquidations and a high probability that supply will outpace demand by some 900k tonnes over the next three years, suggests that prices will drop back down toward $7,000/t in the not too distant future.”
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