Good demand outlook boosts copper price to $ 7,511 per tonne
In the Comex market, copper for delivery in December gained 2.85% to $ 3.4040 per pound ($ 7,488 per tonne) by mid-afternoon of Saturday, November 28, 2020 in New York. The metal rose 1.5% to a seven-year high of $ 7,511 a tonne on the London Metal Exchange, according to Mining News Pro.
“The market remains supported by fiscal stimulus across the world,” analysts from Australia and New Zealand Banking Group Ltd. wrote, according to Bloomberg.
Copper has risen by around 70% since its March 2020 lows, at the heart of the coronavirus crisis. Data from the Shanghai Futures Exchange on Friday showed copper inventories in its warehouses fell to the lowest since late 2014.
The strength of China’s manufacturing rebound and the country’s seemingly insatiable appetite for refined copper imports are the fundamental foundation for copper’s recovery in 2020. The country’s latest plant gauge, scheduled for Monday, is expected to show that the activity of the main consumer of copper will continue to develop.
But funds are now more and more in the driver’s seat with investors positioning at or near historic highs on CME and LME contracts. The weak US dollar also helped. The metal is also gaining ground as a bet on hawkish climate policies that will expand copper-rich power grids.
In the United States, President-elect Joe Biden has pledged to spend billions on renewables. Meanwhile, European Union countries already have plans in place to spend big on the green economy and China plans to become carbon neutral by 2060.
