Copper Market

Supply and Demand

A deficit in copper supply is set to define global markets in 2023. This will be fuelled by increased challenges in South American supply streams and higher demand pressures from China.

Copper is a leading pulse check for economic health, and the metal’s squeeze could be an indicator that global inflationary pressures could worsen, and subsequently compel global Central Banks to maintain their bearish stance for longer.

2023 copper consumption will be driven by the reopening of China and growth in the automotive and energy transition industry that will increase demand for the metal, putting further strain on copper resources. China’s reopening has a major impact on copper’s price with increases in demand predicted in 2023 to push copper prices even higher due to the supply shortage.

Copper prices got off to a tough start in early 2023 with prices finishing the year around US$ 3.81/lb after starting at US$ 4.45/lb. In February 2023 copper futures settled at US$ 4.035/lb (CME data), although the metal hit a low of US$ 3.993/lb. Analysts forecast copper prices for 2023 estimate a range from around US$ 3.40/lb to US$ 5.80/lb, quite a range reflecting Global uncertainties.