Trafigura predicts $15,000 per tonne copper price in coming decade

The world’s biggest copper trader Trafigura Group sees the price of the metal rising to US$15,000 per tonne in the coming decade, as the global decarbonisation and electrification trends take hold and cause a deep market deficit.

In the last 12 months, the copper price has doubled to trade at more than $9,000 per tonne, after the COVID-19 pandemic created supply disruptions and a buying frenzy in China – consumer of half the world’s copper.

Now, commodities giant Trafigura expects ‘Dr Copper’ to rise well over the $10,000 mark, as Western economies move out of the pandemic and the green revolution accelerates, head of copper trading Kostas Bintas said in an interview.

“We thought copper would come out of this COVID crisis stronger, and that’s exactly what’s happened,” Bintas said. “What COVID has done is it has made the rest of the world a major factor in consumption growth, compared to the past, when copper was all about China.”

Trafigura’s conviction call on copper is matched by the likes of investment banks Goldman Sachs and Citigroup, with the former expecting the price to reach $10,500 per tonne within 12 months, and the latter seeing it hit $12,000 next year in its bull-case forecast.

“You can’t move to a green economic environment and not have the copper price moving significantly higher,” Bintas added. Copper demand is set to skyrocket under the green energy transition thematic, while continued supply constraints due to a lack of new discoveries will shape the upward price movement.

@RGNonline