FCX - Copper drops for third straight day on weak outlook for China global economy

2023-07-06 08:42:16 ET

London copper prices fell Thursday for the third straight session, weighed by the prospect of weak global economic growth and disappointing demand in top consumer China.

Bank of America cut its 2023 copper price forecast by 6.8% to $8,788/metric ton, along with downward revisions for other base metals, citing slow activity in China and a global manufacturing recession, although copper is seen holding up better than other base metals in this year's H2 due to its role in the green energy transition.

According to Reuters, benchmark copper ( HG1:COM ) on the London Metal Exchange traded -0.7% at $8,262.50/metric ton.

ETFs: ( NYSEARCA: COPX ), ( NYSEARCA: CPER ), ( JJC ), ( JJCTF )

Potentially relevant stock tickers include ( FCX ), ( SCCO ), ( TECK ), ( HBM ), ( BHP ), ( RIO ), ( ERO ), ( OTCPK:FQVLF ), ( OTCPK:LUNMF ), ( OTCPK:CSCCF )

Copper demand from electric vehicles will rise to 2.8M tons by 2030 from 1M tons this year and 1.5M tons in 2025, which will escalate supply deficits, Goldman Sachs said in a new report.

Goldman forecasts global sales-weighted copper use in EVs will decline to 65 kg/unit by 2030 from 73kg/unit in 2022 due to a potential shift to high-voltage systems and innovation in cell manufacturing, but open-ended deficits in the copper market nevertheless will remain firmly in place.

More analysis on copper:

• COPX: The Copper Squeeze Is Only Getting Started
• Are Copper Markets About To Feel The Weight Of A $2 Billion Stockpile?
• The Stock Market Says One Thing, The Copper Market Says Another

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