Copper has seen a remarkable rally, increasing 15.8% year-to-date and over 30% in the past year, contrasting sharply with gold, which has declined in value. This surge is attributed to heightened demand driven by sectors such as technology and national defense, as noted by Ivanhoe Electric CEO Taylor Melvin.
He emphasized that the need for copper is becoming inelastic, meaning that large tech companies are likely to continue investing in infrastructure regardless of copper prices. Additionally, uncertainty surrounding potential U.S. tariffs on refined copper is contributing to market dynamics, with significant amounts of copper being stored domestically.
Iain Pyle from Aberdeen Investments pointed out that the current market conditions indicate a supply-demand imbalance, suggesting that sustained higher prices may be necessary to incentivize production. Overall, the outlook for copper remains bullish, despite potential short-term volatility related to tariff announcements