That might not sound like good news for copper, but Schodde views the drop as good overall. He thinks the industry will continue to innovate in order to exploit lower-grade deposits and meet growing global demand. Case in point — at the start of 2022, copper was up more than 500 percent since 2000. Although this impressive major increase doesn’t account for inflation, it’s still a sizeable gain. What’s more, copper prices were more or less on the rise during the latter half of the 20th century. If nothing else, copper prices are not expected to take a dramatic downward turn, which is good news for investors.

Interestingly, by looking backwards it’s easy to see that this spike was an expected feature of the long-term picture for copper prices. The red metal has rebounded after a downtrend from about 2011 to 2015, and over the last few decades prices have increased even more dramatically. The current price of copper as of March 22, 2024 is 4.01 per pound. A halt of growth in emerging economies would almost certainly have a negative effect on copper prices. While copper prices may seem grim now, this isn’t a permanent indicator of the metal’s value.

  1. The short answer is yes, physical copper bullion can play a relatively small but vital role within a diversified investment portfolio.
  2. For example, the Copper Futures price on Comex is different from what you see on the London Metal Exchange (LME).
  3. Cheaper metals such as aluminum are now a substitute for copper in power cables, electrical equipment, and refrigeration equipment.
  4. It’s been used for thousands of years with increasing demand as new technology springs up all over the world.
  5. Analysts have noted that the country’s infrastructure and property sectors, both of which require large amounts of copper and other commodities, are also showing signs of weakness.

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You can also learn about the national economies of countries like China and India, both of which are key players in the copper market. One standard ounce of copper is equal to almost exactly 28 grams. One troy ounce is rounded to 31.1 grams — this unit is typically used on exchanges and by bullion dealers. Historically, countries in this region have occasionally chosen governments that nationalized the mining industry. Although copper has often been used in circulating coinage, it is not considered to be a precious metal like Gold and Silver. Copper is instead classified as base metal or industrial metal.

What factors have impacted copper prices historically?

Copper bullion might be harder to purchase than the likes of gold, silver, platinum, or palladium since it’s not classified as a ‘precious metal’. The economic principle of substitution represents a risk of investing ctpartners confirms receipt of unsolicited proposal from dhr international in any commodity, and copper is no exception. As prices climb, buyers will seek cheaper substitutions, if available. Political, environmental, and labor issues can have a big impact on copper prices.

A Look at Historical Copper Prices

Miners are finding less copper in digs, and unearthing new copper sources through mining isn’t as easy as it sounds. The most abundant supply of copper comes from the U.S. and Chile, but even in those areas, this metal content isn’t infinite. In recent years, new technology has caused demand for copper to go up. The automotive industry forms one of the most substantial copper demands in the world, in part due to modern electric vehicles that use copper wiring. Smartphones and electric household appliances and their respective production also require copper parts. Copper is a brownish-orange metal used in countless applications.

South America supplies a significant amount of copper, particularly Chile and Peru. Factors that affect US housing demand, including nonfarm payrolls, mortgage rates, US gross domestic product (GDP), and demographics, also play an important role in determining copper demand. Some experts, however, predict that copper will start on a bullish trend by 2022. Copper prices have been in a bearish trend recently, and they’re not necessarily expected to rise anytime soon. In fact, most forecasts for copper prices over the next few years continue to be bearish at worst and neutral at best. The most common weight units to measure copper are pounds (lb), standard ounces (oz), troy ounces (t oz), and grams (g).

Nickel, lead, and iron also competes with copper as substitutes in some industries. It’s worth noting, however, that many experts say it’s wise to invest in multiple metals to diversify and have something to fall back on if one metal’s value decreases.

Auric Mining a ‘Gold Story’ to Watch, Analyst Says

Speculators should pay close attention to trends in this market for clues about future copper prices. Regarding inflation, patterns, and trends over recent decades give some market data indication as to how copper prices will fare in stocks and futures over the next few years. China is still a strong copper demand driver, with the most recent data showing that it was the largest consumer of refined copper at 13.65 million metric tons in 2022. Different exchanges and brokers list different live copper prices because of several reasons. In the case of exchanges, the market maker and data provider may be different.

The major factors contributing to copper prices are supply and demand, economic growth, inflation, and the value of the dollar. While Ioannou said supply and demand dynamics are the main driver for prices, grade and production costs are factors as well. Demand for copper keeps growing, and he suggested that since “the low-hanging fruit has been mined,” miners must increasingly go after more difficult, large, low-grade and costly deposits. The price of copper may depend greatly on the ability of these countries, as well as other emerging economies like Brazil. According to Stefan Ioannou of Cormark Securities, it’s most pragmatic to look at historical copper prices since the 1970s or 1980s. The building construction industry is responsible for close to half of the US copper supply.

Any examples given are provided for illustrative purposes only and no representation is being made that any person will, or is likely to, achieve profits or losses similar to those examples. DailyFX Limited is not responsible for any trading decisions taken by persons not intended to view this material. As with most investments, supply and demand dictate in large part how copper prices move. Mine outputs, while increasing in some areas, may decrease in others as they each exhaust their copper supply.