The price of copper on the London Metal Exchange (LME) rose to $9,990/t on 29 April, marking a ten-year high and closing in on the record high LME price of $10,147.50/t on 14 February 2011.
In its new Copper Monthly Insights, Roskill said that the ongoing surge in copper pricing is taking impetus from President Biden’s new CO2 targets. Roskill also noted that world visible stocks saw a seasonal rise to 881kt by 23 April 2021. These stocks, however, currently represent only 1.9 weeks of consumption in 2021. Total Chinese stocks (658kt) are equivalent to 2.6 weeks consumption while Rest of the World stocks (223kt) are only equivalent to 1.1 weeks consumption.
There is accumulating evidence of a robust demand recovery in China and the ROW, Roskill said. Chinese refined consumption rebounded 18% YOY in Q1 2021. Unwrought imports to China jumped 25% YOY to 552kt, while concentrate volumes surged 22% YOY to a new monthly record of 2,171kt. Goldman Sachs and Robert Friedland, Founder of Ivanhoe Mines, suggest prices of US$15,000/t might be seen by 2025, due to restricted supply and bullish demand growth.
Although Chile and Peru contributed 40% of global mine supply in 2020, Roskill observed, copper production there is yet to fully recover to pre-pandemic levels. Mining in both countries continues to be affected by restrictions introduced to control the pandemic. In April, a surge in case numbers lead to the closure of the Chilean border and a subsequent jump in the copper price.
Volumes of copper scrap imports have been declining annually since 2017. Annual imports of material classed as E-scrap have also been decreasing since 2018. E-scrap is a valuable raw material input for copper smelters and is a rich source of copper, tin, gold, silver and many PGMs.