Pay close attention to copper stocks.
Trafigura Group believes the metal could hit $15,000 a ton over the next decade, reports Bloomberg. All as demand from decarbonization efforts produces a potential deficit.
After all, “You can’t move to a green economic environment and not have the copper price moving significantly higher,” says Kostas Bintas, trader at Trafigura, as quoted by Bloomberg. “How can you have one without the other?”
For one, according to Mining Review, “We expect copper demand growth outside of China to be a key driving force this year. The global industrial recovery is picking up pace, with macro indicators across several key copper consuming nations showing strength. The approval of the USD 1.9bn stimulus package in the US, as well as green stimulus measures across the EU countries, will also provide a boost to copper demand, effectively bringing forward the green energy boom by several years.”
Coupled with supply issues, and the price of copper could easily gain momentum.
Even Ivanhoe Mines’ founder and co-chairman, Robert Friedland says copper supply has become a national security issue. “In the short term, we’ve had a big rise in the price of copper,” he said, as quoted by Bloomberg. “But for the medium term, copper has really become a national security issue. It’s central for what we want to do with our economy.”
Some of the top ways to trade copper include Southern Copper (SCCO), Rio Tinto (RTNTF), and ETFs such as the Global X Copper Miners ETF (COPX).