Soaring demand for copper will help drive mergers, BHP CEO says
Demand for copper, a key element in the energy transition, is set to rise by 70% to 100% by 2050, Mike Henry said
Aluminum prices fell on Wednesday as China dashed hopes of an easing in covid-19 restrictions that have dampened economic growth.
Three-month aluminum on the London Metal Exchange (LME) dropped 1.1% to $2,212.50 a tonne by 1000 GMT, its fifth day of losses.
According to the official newspaper of the Communist Party, the country will persist with its strict covid-19 policies.
“The market had been hoping for some kind of easing in the aftermath of the Congress, but it looks like they’re putting all their efforts into maintaining these restrictions,” said Ole Hansen, head of the commodity strategy at Saxo Bank in Copenhagen.
Beijing and other regions carried out environmental inspections on factories that have trimmed spot metals demand, ahead of a Communist Party congress starting on Oct. 16.
“Buyers in Shanxi province lowered their spot purchases as their production is being affected by inspections that currently take place a few times a week,” one China-based metals trader told Reuters.
Copper also retreated on Wednesday. The metal for delivery in December fell 1.3% on the Comex market in New York, touching $3.41 per pound ($7,502 per tonne).
[Click here for an interactive chart of copper prices]
“Speculators were becoming more reluctant to take bearish positions in copper in recent weeks,” Hansen said.
“Copper is not really fully responding to the demand downgrades that we’re seeing in the belief that there should be some supply issues as well,”
Meanwhile, miners in Chile are looking at transportation alternatives after a key railway suspended the transport of copper due to growing theft in the country’s main mining region.
BHP Group and Codelco said they have activated their respective contingency plans after rail operator FCAB halted services due to repeated thefts. While neither company gave details, trucking the metal would be the logical alternative.
Copper output in Chile fell 10.2% in August.
(With files from Bloomberg and Reuters)
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