Strong opportunities seen in copper investment

Recognition is growing about the strong opportunities around copper investment in 2024.

Global investment manager Sprott has identified copper shortages and potential price rises as one of its top 10 themes of the precious metals world his year.

In its latest report under the heading, Copper’s Supply-Demand Imbalance Worsens, it says: ‘’There is a minimal buffer in copper inventories and that heightens the risk of sudden price surges’’.

The need for copper in energy transition has mitigated slower growth in China and rising interest rates, it said.

‘’However, the robust outlook for growth in copper demand contrasts starkly with the supply side, it said.

Slower-than-expected new builds and capacity expansions, coupled with the depletion of copper reserves from aging assets, were concerning. It highlighted problems in Latin America, where Codelco, the largest copper miner in the world, is experiencing its lowest production levels in 25 years.

It all added up to a perfect storm for copper investment.

‘’There is also the potential for mergers and acquisitions in the industry as many large miners prioritize copper as a strategic metal, adding an additional layer of optimism for existing copper miners.’’

Sprott’s full report of its top 10 precious metals trends for 2024 can be found here.

The predictions were immediately picked up on by Australian financial news outlet Stockhead. Its coverage can be found here.

Meanwhile, more investment love has been shown for copper by Australian fund managers.

In an Australian Financial Review article, copper was again highlighted as a key opportunity in 2024.

‘’Fund managers hope bets on commodities such as gold, copper and uranium can help catapult returns in 2024,’’ it said.

Full article here (note it is behind a paywall).

And any growth in the price for copper may not just be short-term, with  demand likely to surge for electric vehicles over next decade.

One research company is predicting a 300 per cent increase in copper use for EVs.

“The growing electrification of the automotive market will drive a 3.1-fold increase in copper demand for EV motors in 2034 compared with 2023,” says market research firm IDTechEx.

Its predictions can be found in the second half of this Stockhead article.

With copper exploration one of Eastern Metals’ main focuses in 2024, all of this news can only be good for our shareholders.

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