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Copper Price Update: Q3 2023 in Review
How did copper perform in Q3, and what's ahead for the rest of 2023? The Investing News Network caught up with analysts to find out.

Copper prices have experienced volatility in 2023, but the overall trend has been down.
The metal hit its highest point of the year on January 23, reaching US$9,438.65 per metric ton (MT). During Q3, prices reached a quarterly high of US$8,850 on July 31 before retreating and closing out September at US$8,225.01.
Copper's price performance in Q3 2023.
Chart via the London Metal Exchange .
Various factors have contributed to copper's fall over the course of the year, including the easing of the supply chain issues that caused prices to spike from the end 2022 into the start of 2023.
What are the factors that affected prices during the third quarter? Read on to find out.
Chinese copper demand takes a hit
The worsening crisis in China's real estate has been a key contributor to copper's price decline. Country Garden (OTC Pink: CTRYF ,HKEX:2007), the country’s largest real estate company, warned in August that it was nearing default on its debt, while Evergrande’s (OTC: EVGPF ,HKEX:3333) American arm filed for Chapter 15 bankruptcy protection in August.
The real estate sector represents 30 percent of China’s GDP and is a primary consumer of the red metal. While the government has tried to stimulate home buying in the country, its efforts haven’t achieved positive results. The precarious state of the industry in China has heavily impacted the outlook for copper demand.
Copper surplus expected in 2024
This sinking demand has been happening alongside global copper production increases , which the International Copper Study Group believes will shift a 27,000 MT deficit for 2023 to a surplus of 467,000 MT in 2024.
Higher output of the red metal is being driven by new mines starting production in the Democratic Republic of Congo (DRC), Peru and Chile. These new operations include the Phase 3 expansion of Ivanhoe Mines' (TSX: IVN ,OTCQX:IVPAF) Kamoa-Kakula mine in the DRC, which is on track to deliver 390,000 to 430,000 MT of copper in 2023.
Anglo American (LSE: AAL ,OTCQX:AAUKF) is also set to make significant copper production contributions this year. The company's Peru-based Quellaveco mine, which came online in 2022, is expected to reach its target of 310,000 to 350,000 MT of copper in 2023. Meanwhile, in Chile, Phase 2 of Teck Resources' (TSX: TECK.A ,TSX:TECK.B,NYSE:TECK) Quebrada Blanca project delivered its first bulk copper concentrate in March. It is expected to put out 100,000 MT of the red metal in 2023 before ramping up to 285,000 to 315,000 MT per year between 2024 and 2026.
Additionally, in September, Udokan Copper began production at Udokan, which has been referred to as Russia’s largest untapped copper deposit. It is part of the Trans-Baikal region and is home to several other mining deposits. The mine has an estimated yearly production of 150,000 MT of copper cathode and concentrate, with 26.7 million MT of copper resources. However, with US sanctions in place, the company's ability to reach the global market is limited.
Protests in Peru disrupt copper supply
The year started with a series of deadly mining protests in Peru — they began in late 2022 and continued through March, leading to a 25 percent year-on-year drop in mining exports from the country in January.
While the protests slowed in the second quarter, they once again flared up in mid-July and into August, this time coordinated by mining workers and unions who demanded the resignation of President Dina Boluarte. However, the latest round of protests were largely confined to the nation’s capital of Lima, limiting their effects on the mining sector.
After months of unrest, Peruvian Prime Minister Alberto Otarola pledged at the end of September to crack down on the chaos and instability . Industry insiders have noted that the country remains weak in its effectiveness in curbing the protests, and there is uncertainty around government stability as well as industry regulations and red tape .
Despite these issues, copper production in Peru increased by around 19 percent during the first three quarters of the year compared to the same period in 2022. In an email to the Investing News Network, Federico Gay, senior mining analyst at Refinitiv, noted that these production increases were largely due to new mining operations coming online or reaching capacity in Peru in 2023, including Anglo American’s Quellaveco.
This increased production will help Peru retain its position as a top copper producer for the time being. “We estimate Peru will remain the second largest producer for the next couple of years,” Gay explained, “but the DRC, currently the third largest producer, is threatening to take Peru’s place in the future.”
Major miners make copper M&A moves
Mining industry mergers and acquisitions have been running hot in 2023, but what does that mean for copper specifically? There were several agreements made during the third quarter.
Rio Tinto (ASX: RIO ,NYSE:RIO,LSE:RIO) announced on August 1 that it has agreed to purchase Pan American Silver’s (TSX: PAAS ,NYSE:PAAS) 57.74 percent operating stake in Agua de la Falda, and will enter into a joint exploration venture with the state-owned Corporacion Nacional del Cobre de Chile (Coldelco), the world's largest copper producer. Along with the partnership, Rio Tinto will acquire 100 percent of the nearby Meridian property exploration concessions.
The company notes that Agua de la Falda was previously explored for precious metals, but there has been little exploration for copper, which will become the primary focus of the project.
On August 28 , Rio Tinto also completed a transaction with First Quantum Minerals (TSX: FM ,OTC Pink:FQVLF) to develop Rio Tinto’s La Granja project, which it acquired from the government of Peru in 2006. The site has a measured mineral resource of 130 million MT at 0.85 percent copper and an inferred resource of 4.19 billion MT at 0.5 percent copper.
Glencore (LSE: GLEN ,OTC Pink:GLCNF) announced on July 31 it had reached an agreement to acquire Pan American’s stake in the Minera Agua Rica Alumbrera (MARA) project. The acquisition will make Glencore the sole owner of the project in Northwestern Argentina. Glencore says MARA has proven and probable mineral reserves of 5.4 million MT of copper and 7.4 million ounces of gold, and will produce more than 200,000 MT of copper annually.
On July 13, Lundin Mining (TSX: LUN ,OTC Pink:LUNMF) closed its acquisition of a 51 percent interest in SCM Minera Lumina Copper Chile. The acquisition will give Lundin access to the Caserones copper-molybdenum mine in Chile. Caserones produced 69,704 MT of copper and 2,393 MT of molybdenum in the first half of 2023, and contains proven and probable reserves of 2.55 million MT of copper and 76,000 MT of molybdenum.
What's ahead for the copper market in 2023?
While protests in Peru may have cooled, the political situation remains delicate in South America as countries throughout the region shift from right to left-leaning policies. “The consensus seems to be lacking consistency regarding foreign policies and investment protection,” Gay noted. This could mean further future instability for supply.
Looking further into the future, with more countries enacting policies for the green energy transition, demand for copper is expected to soar over the next decade. In fact, it has already been labeled a critical mineral by the US Department of Energy for its use in electric motors and renewable power generation.
Additional demand is likely to come from the real estate market as countries work to solve the global housing crisis. The market is already the largest consumer of copper, and pressure is mounting to build more affordable homes, as it’s predicted that 1.6 billion people could be impacted by the crisis by 2025. The World Economic Forum estimates 3 billion people will need access to affordable housing by 2030, requiring the construction of 96,000 homes per day.
Adding to the supply and demand problem is a lack of new mines being built. “The main problem is that the industry is not communicating the urgency to bring new mines online,” Gay said.
The new copper mine starts and expansions beginning operation in 2023 and 2024 are the last planned for the foreseeable future, and new mines can take decades to complete . This might be good news for those chasing the price of copper, but it’s likely to have a domino effect on other industries that rely on the red metal.
“We are reaching a point of no return for developing the long list of mining projects needed for the energy transition plans,” Gay said. “But it is my opinion that regulations are not expected to ease in the near future.”
Gay suggested that prices for copper are set to remain stable for the next few quarters, hovering around $8,500 through the end of 2023, before rebounding slightly to around $8,800 in 2024.
Don’t forget to follow us @INN_Resource for real-time news updates!
Securities Disclosure: I, Dean Belder, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
- Is the World Running Out of Copper? (Updated 2023) ›
- Copper Prices Could See "Astronomical Rise" as Supply Concerns Increase ›
- Copper Market: 5 Trends to Watch Heading into 2023 ›
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- When Will Copper Go Up? ›
Dean has been writing in one form or another since penning stage plays in his youth. He is a graduate of both Emily Carr University and Simon Fraser University, with a BFA in photography and a BA in communications.
As a writer, Dean has traveled throughout BC and the Pacific Northwest covering cultural events, interviewing small business owners and working alongside fellow writers and photographers from publications like Rolling Stone Magazine, Spin and the Georgia Straight.
Dean has a keen interest in investing, and enjoys learning about the mining industry and better understanding the technical aspects of trading. In his spare time, Dean is an avid home chef, ponders the space-time continuum and makes his own cider. On weekends he can be found cycling the Seawall, exploring farmers markets or sampling the city’s local craft breweries.
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Commodities | |||
---|---|---|---|
Gold | 2029.22 | -90.83 | |
Silver | 24.50 | -1.25 | |
Copper | 3.83 | -0.11 | |
Oil | 73.29 | -0.78 | |
Heating Oil | 2.66 | 0.00 | |
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Dean has been writing in one form or another since penning stage plays in his youth. He is a graduate of both Emily Carr University and Simon Fraser University, with a BFA in photography and a BA in communications.
As a writer, Dean has traveled throughout BC and the Pacific Northwest covering cultural events, interviewing small business owners and working alongside fellow writers and photographers from publications like Rolling Stone Magazine, Spin and the Georgia Straight.
Dean has a keen interest in investing, and enjoys learning about the mining industry and better understanding the technical aspects of trading. In his spare time, Dean is an avid home chef, ponders the space-time continuum and makes his own cider. On weekends he can be found cycling the Seawall, exploring farmers markets or sampling the city’s local craft breweries.
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