Copper Prices Hit $10,000 a Ton. Are Investors Too Bullish?

Copper Prices Hit $10,000 a Ton. Are Investors Too Bullish?

Come up 10,000 on on top of the highest
levels that we’ve seen for about two
years.
What is the level that’s around pricing
of copper that gets CapEx back to levels
that that could start to see real
production flows coming through for this
metal?
Yeah, it’s you need you definitely need
good prices to get these bigger projects
off the ground these days.
Glencore has certainly signalled out
saying that they want to see copper
sustainably above 10,000 before they
start trying to do green for copper
projects like El Cajon in Argentina, so
and so forth.
But at the end of day we are where we
recently did the CapEx analysis.
It’s incredibly highly correlated to
just whatever happens in the previous
years moves in terms of prices.
So absolutely, expect copper CapEx to be
up, you know, ten, 15% above consensus.
And briefly on on prices, I don’t know
if you have an outlook for the rest of
the year, but is it does it look
stretched to this point?
Is that further upside for copper, do
you think certainly in house view that
it’s it’s got it’s it’s overdone, the move, if you look at a lot of the
physical fundamentals, the other kind of
short term indicators like physical
premium in China that’s collapsed to
zero.
There’s not appetite for physical metal
demand.
There’s plenty of inventories available.
There’s not really a concern at this
level.
It feels like a big speculative push.
So when that mines timing is always
difficult, you know, people have very
strong and long held beliefs that copper
is going high for longer, but this one
feels a bit premature.

Ben Davis, mining analyst at Liberum, says copper’s surge is “overdone” after prices hit $10,000 a ton for the first time in two years. “If you look at a lot of the physical fundamentals, the other kind of short term indicators like physical premium in China, that’s collapsed to zero,” Davis tells Bloomberg Television. “People have very strong and long-held beliefs that copper is going higher for longer, but this one feels a bit premature.” Benchmark copper prices have rallied by 17% this year.
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