The fundamentals for copper have stabilized.
Some time ago, the fundamental data deteriorated as demand was weak and inventories had built up significantly. However, Chinese copper purchases have now increased. Inventories are falling accordingly. They are around 30 percent lower than in June. The not insignificant scrap market for the reddish metal is also declining. Analysts see a bottom forming at USD 8,700 to 9,000 per tonne of copper and an attractive entry opportunity.
In the longer term, copper consumption should benefit from the areas of renewable energies, electric vehicles, AI data centres and defence. Sales of electric vehicles and the installation of photovoltaic systems are increasing. The next growth spurt in e-mobility is likely to come particularly from trucks and vans. This is because commercial vehicles and heavy trucks account for around 20 per cent of CO2 emissions in Europe. Copper is not only present in many energy storage systems, it is also an important component of lithium-ion batteries. It is also used in wind turbines and heat pumps. Electrification, automation and digitalisation, in conjunction with a secure energy network, make copper a key material.
The longer-term fundamentals are therefore likely to be intact. As far as the copper supply is concerned, growth is unlikely. There could be a copper deficit in as little as a year, which would drive up prices. Copper shares have a leverage on the copper price and an entry could be favorable right now.
Mogotes Metals - https://www.commodity-tv.com/ondemand/companies/profil/mogotes-metals-inc/ - is a noteworthy candidate in the copper sector. The company is active in copper and gold in Argentina and Chile. The Filo Sur copper project in the Vicuña district in Argentina looks particularly promising.
Foran Mining - https://www.commodity-tv.com/ondemand/companies/profil/foran-mining-corp/ - is involved in copper, zinc, gold and silver and owns several projects in close proximity to each other in a region in eastern Saskatchewan. Scotiabank sees a price target of CanDollar 4.50 based on the excellent drill results.
Current company information and press releases from Mogotes Metals (- https://www.resource-capital.ch/en/companies/mogotes-metals-inc/ -) and Foran Mining (- https://www.resource-capital.ch/en/companies/foran-mining-corp/ -).
In accordance with §34 WpHG I would like to point out that partners, authors and employees may hold shares in the respective companies addressed and thus a possible conflict of interest exists. No guarantee for the translation into English. Only the German version of this news is valid.
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