Copper is witnessing a record rise in the major commodity markets of the world, including India. Experts related to analytics and commodity markets are giving many reasons behind this. Global agencies also believe that in the future the price of copper will continue to record a period of boom.
Copper prices are witnessing a rise in the worldwide commodity market.
There is a record boom in the commodity market globally. Apart from steel, aluminum, copper is also doing business at a record level. On Thursday, the price of copper in the international market has crossed a record $ 10,000 per ton. The price of Shanghai copper has also reached the highest level in the past 10 years. Copper futures are also at record highs in the past decade in London, amid concerns over supply and weak dollar.
Information and agencies related to the commodity market say that in the coming time, the price of copper will see a boom. There are several reasons for this record boom in copper. For example, economic recovery is taking place across the world, industrial copper consumption has increased in China, and Chile, which produces about a quarter of the global copper, has announced a tax of 75 per cent on its mining. Apart from this, due to the increasing trend of electric vehicles, the demand for copper is increasing.
If we talk about the Indian market, the price of copper was at the highest level so far last week. On Thursday, copper futures were up 0.53 per cent at Rs 765.10 per kg. Copper futures for May delivery on the Multi Commodity Exchange (MCX) gained Rs 4, ie 0.53 per cent. The demand for copper has increased in India too.
Why is the copper price rising so fast?
1. More demand and less supply: Some time ago the Chilean Port Workers and Mining Association opposed a bill by the government. In fact, the Chilean government had introduced a new bill, under which workers were asked to block premature withdrawal from their pension funds for the third time.
About a quarter of the total global copper production comes from Chile. After the opposition of the association and the workers, the copper supply decreased and prices increased.
Apart from this, COVID-19 has impacted exports of many major commodities like iron ore and copper in South America. Even in America, copper is also seen as a raw material in the infrastructure plan of Joe Biden.
However, in terms of supply, copper output in Peru has gone up by about 19 per cent during the month of March. Globally, there has been some relief from this.
2. Less inventory: There has been a sharp decline in registered copper inventories on the London Metal Exchange. Analysts estimate that there has been a downward trend in this. As of 26 April 2021, the copper inventory at the London Metal Exchange was only 1,55,100 tonnes. In the second fortnight last month, it has reduced by 10 percent.
3. Demand increased: Construction activities have increased in China this year. After this, the demand for copper in China has also increased. Let us know that half of the total consumption of copper in the world is from China. Analysts say that China consumes the most copper and now demand has increased due to large-scale construction here. This is also a reason why the price of copper is getting faster.
A boom in economic development is now being expected in America. It will also have an impact on global economies. In the era of COVID-19 crisis, countries around the world have announced an incentive package. On the other hand, good news is also coming about the corona vaccine. Both these factors have affected the price of copper.
4. Green Infrastructure: Demand for electric vehicles is increasing worldwide to reduce carbon footprint and promote the use of clean energy. In electric vehicles, copper is used twice as much as internal combustion engines. In such a situation, with the increase in demand for electric vehicles, the demand for copper will also increase.
What is the estimate of agencies?
In a recent report by Goldman Sachs, estimates say that by 2025, copper prices can reach $ 15,000 per tonne. The report titled ‘Copper is the new oil’ states that banks believe that by 2030, the annual demand for copper will rise by 900 per cent from the current level to 87 lakh tonnes.
Trading houses Trafigura Group and Bank of America also believe that copper prices have increased. Bank of America says that in the coming months, the price of copper can reach $ 13,000 per tonne.
Also read: This rule regarding income tax has changed, if you do not know now, be ready to pay the fine