Brave New World - Edition 15

06 Jun 2022 | 5 Mins Read
By: Eastern Fin Research Team
#Brave New World
No Decarbonization without Copper
  • Demand for copper presently is ~24 mn tones per year out of which non green demand (wiring) works to ~22.5mn tones & green demand (wind & solar) is about 1.5 mn tones. By the end of this decade, green demand for EV, charging infrastructure is expected to go upto 6-7mn tones moving from 5% of global demand to 20%.
  • There isn’t shortage of copper in the earth’s crust but not much capital is flowing into those projects. Reasons – near death experience by miners in 2013/14 crash after over building in response to high prices of 2000s, ESG influence, high time lag in securing mining permits, shortage of skilled mining labour etc.
  • Increases in demand for copper are expected to be very high unlike oil. It takes a really long time to get new production online. The existing production is expected to peak at the end of 2023/beginning of 2024 post which we see phase of open ended contraction of 1% from 2025 onwards. (Source: Bloomberg)

There are ETFs listed in US focused on Copper – COPX and CPER available for investment by Indian resident investors.


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