Your trusted source for investing success

Tag: copper prices

Copper trades on a number of different metal exchanges, including the London Metal Exchange (LME), the COMEX in New York and the Shanghai Metal Exchange (SHMETX), and copper prices may be found via these exchanges. Unlike precious metals prices, which are consistently denominated by the ounce across various exchanges, copper prices are denominated by the pound when traded on the COMEX and by the kilogram when traded on the LME.

Furthermore, spot copper prices represent the current price for the metal, while copper futures represent copper priced for delivery at a future date. For example, copper for delivery in three months would be priced differently than spot copper. As with any commodity, supply and demand dynamics are key drivers for the copper price. While copper inventories on metal exchanges are commonly looked to as an indicator of copper supply, there are many other factors to be considered.

Mine production, scrap copper supply and unknown stores of copper in China, the world’s top consumer of the metal, are all key considerations when looking at whether there is a surplus or deficit for copper. Much of the world’s copper supply comes from Chile, although other countries, such as China, Peru and the United States, also produce significant amounts of copper.

Changes in forecasted copper output from larger miners and countries can cause the copper price to rise or fall, depending on the extent production is cut or expanded.

In terms of demand, copper is widely used in construction and in electrical wiring, for which there is no commercial substitute for the metal. As mentioned above, China is the world’s largest consumer of copper, making up roughly 40 percent of global demand. For this reason, economic indicators from China can be a key factor in day to day movements of the copper price.

In particular, Purchasing Managers Index (PMI) data indicates whether the manufacturing sector in China is growing or contracting, and copper prices typically move upwards with healthy manufacturing data. However, healthy manufacturing data may also indicate that China’s government may not need to implement additional economic stimulus measures, causing copper prices to fall. Other policy changes from China can also affect prices, such as investments in additional infrastructure.

Beyond that, the performance of other larger economies, such as that of the United States, may also have an impact on prices. In fact, it’s worth noting that the copper price is commonly known as ‘Dr Copper,’ as the red metal is said to have a PhD in world economics given the close relationship of its performance to that of the global economy.

4 Copper ETFs and ETNs

4 Copper ETFs and ETNs

There’s more than one way to invest in copper. In addition to stocks, investors can gain exposure to the red metal through copper ETFs and ETNs.

Enter Your Log In Credentials
This setting should only be used on your home or work computer.


Privacy & Legal Policy

Privacy Policy

Investing News Network

Send this to a friend

I thought you might find this interesting:
Weekly Round-Up: Gold Price Recovers from Four-week Low