Will COPPER be the next LITHIUM?

[Azzler]

I've been hearing some talk of late about an impending copper undersupply.
And it's based on the same reasoning that Lithium became hot, that is because of the mineral demand from the EV revolution.

I heard one fund manager rubbishing the EV revolution because apparently we wont have enough copper to make it happen.
But wouldn't that just make copper prices soar, as lithium did?

Lithium has been touted as the bottle neck, creating price demand.
The same should be true for copper if indeed it's true.

I'm creating this thread to see if anyone has looked into this yet?
What are your thoughts?

This is literally my first day of looking into this so I'm starting here by asking you lovely people if you could share any research and opinions you may have.

Is there any truth to a supply gap, or is it just ignorance?

 

[Frank]

 

[Frank]

 

[Sparrowhawk12]

I've been hearing some talk of late about an impending copper undersupply.
And it's based on the same reasoning that Lithium became hot, that is because of the mineral demand from the EV revolution.

I heard one fund manager rubbishing the EV revolution because apparently we wont have enough copper to make it happen.
But wouldn't that just make copper prices soar, as lithium did?

Lithium has been touted as the bottle neck, creating price demand.
The same should be true for copper if indeed it's true.

I'm creating this thread to see if anyone has looked into this yet?
What are your thoughts?

This is literally my first day of looking into this so I'm starting here by asking you lovely people if you could share any research and opinions you may have.

Is there any truth to a supply gap, or is it just ignorance?

Reasonably regular analyses of global mining / commodities, including EV demand, by macrobusiness.com.au says there is no structural deficit of copper supply for the foreseeable future. A big reason is China's build of ghost cities & idle infrastructure over the last 20 years has stopped and the excess copper mines/supply is far more than needed for the EV revolution. FWIW IMO. Br Sparrowhawk.

 

[Flight996]

I am also reading that a copper crunch is on the horizon. As we all know, a number of converging issues, including near-term, mid-term, and long-term scenarios are at play.

In the near term, the primary culprit is low capital investments from mining companies and growing financing and labor costs.
https://seekingalpha.com/article/4594177-copx-the-copper-shortage-is-unlikely-to-persist-in-2024
In the mid-term, there are larger factors at play, such as the increasing demand for copper for the energy transition and the shortage of processing technologies to overcome shortfalls in the global supply. This scenario applies to the vehicle industry in particular where it is difficult to substitute aluminium for copper as they do in heavy industry and power transmission. The average EV uses approx 80kgs of Cu, and the average conventional vehicle uses approx 20kg.
https://www.mckinsey.com/industries/metals-and-mining/our-insights/bridging-the-copper-supply-gap
In the longer term, maturing mines, reducing grades, environmental issues, geopolitical issues and the incentive to use cash flows for capital returns rather than investment in new mines are likely key factors leading to a shortage of the raw material. Currently, there is inadequate investment in expansion and development to meet the growing demand for copper.
https://www.bloomberg.com/news/arti...spite-signs-of-looming-crucial-metal-shortage
I had some pure Cu plays in my emerging portfolio, but my main one AVB was taken over by OZL, which was in turn taken over by BHP. One in particular, TMS is a minnow that may one day roar. It seems to have the right combination of grades, volume, location and management skills to eventually pull it off...maybe.

Cheers
F

 

[Flight996]

The International Copper Study Group (ICSG), is a credible source of detailed data on global copper mining, smelting, useage and forecasts.

Its March newsletter (22 March 2023) suggested a global surplus of refined copper of about 103,000 tonnes in January 2023. However, its more recent detailed forecast for 2023-24, suggests a global deficit of about 114,000t for 2023, and a surplus of 298,000t for 2024. The forecast does not go beyond 2024.
You can read all the detail at: https://icsg.org/press-releases/

Cheers
F

 

[AusEire]

For me Tungsten will be the next Rare earth to go off. 80-85% of the resource is controlled by China and Russia. Australia has a couple of good mining resources on tungsten could bode well for the country to have these.

 

[Bray]

For me Tungsten will be the next Rare earth to go off. 80-85% of the resource is controlled by China and Russia. Australia has a couple of good mining resources on tungsten could bode well for the country to have these.

The tungsten mine down on King island TAS has one of the best grades anywhere in the world, I believe they reopened it

 

[Azzler]

For me Tungsten will be the next Rare earth to go off. 80-85% of the resource is controlled by China and Russia. Australia has a couple of good mining resources on tungsten could bode well for the country to have these.

There would have to be a reason for an undersupply of the stuff for a boom.
What's the Tungsten story there?

 

[AusEire]

The tungsten mine down on King island TAS has one of the best grades anywhere in the world, I believe they reopened it

Correct they are just about to begin production and recently raised $30m for their CAPEX.

 

[AusEire]

There would have to be a reason for an undersupply of the stuff for a boom.
What's the Tungsten story there?

With so much of the worlds reserves of Tungsten tied up by 2 countries it wouldn't take much. No one trading with Russia currently and Taiwan under threat by China could set off supply issues.