Copper hits unseen highs since 2022 amid optimism for growth

Scarlet Ibarra / April 12, 2024 | 12:03
This increase reflects confidence in economic recovery following pandemic challenges, as well as in the transition towards a greener and more sustainable economy.

The price of copper has reached unseen levels since 2022, driven by optimism surrounding global economic growth and sustained demand for this metal in key industries such as construction, electronics, and renewable energy.

Copper prices on Friday reached their highest level since June 2022, amid expectations of a rebound in demand due to potential interest rate cuts in the coming months.

The reference copper on the London Metal Exchange (LME) rose by 2.2% to $9,552 per metric ton at 1140 GMT. This metal, used in the energy and construction sectors, had reached a session high of $9,590.50 per ton.

Amidst signs of economic recovery, particularly in China, the largest consumer, a buying frenzy has ensued, propelling aluminum prices to their highest level since February 2023 and zinc to year-long highs.

Dan Smith, head of research at Amalgamated Metal Trading, commented, "There is a flood of liquidity in metal markets and overall markets (...) the growth cycle will be quite strong in the coming months," noting that Chinese PMI data reinforced optimism about economic growth.

Surveys of Chinese manufacturing purchasing managers showed the sector expanded in March at the fastest pace in 13 months, driven by orders from domestic and foreign customers.

Copper prices were also buoyed by supply disruption concerns, which created a shortage of concentrate for producing refined metal.

Among other base metals, aluminum rose by 1.7% to $2,496 per ton, zinc advanced by 3.2% to $2,847, lead gained 1.6% to $2,178, nickel added 1.4% to $18,065, and tin climbed 2.9% to $32,620. BoA Securities forecasts that copper and aluminum prices will average $12,000 and $3,250 per ton, respectively, in 2026.


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