“The WBMS said that for the first eight months of this year, their was a supply deficit in the copper market of 161,000 tonnes, compared with last year’s 16,000 tonne oversupply for the first eight months of 2009.
This growing oversupply is indicative of the major issue facing the copper market; ever growing demand for the metal as the global economy recovers, and increasing demand from China and India, is failing to be met as no new major copper production or mines are coming on line. This situation looks set to continue probably into the longer term, and suggests the very fundamental premise that copper prices will continue to climb while supply fails to meet demand.”
We will be watching copper prices even more closely as the U.S. Federal Reserve gets ready to flood the U.S. economy with more money. Assuming its impact is not already priced into the market, copper prices could really take off later this year and into 2011. Copper has already reached pre-recession levels.
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