Commodities trader Pierre Andurand has forecasted a significant surge in copper prices due to high demand and challenges in the supply chain. He suggests that this increase could continue for several years.
Andurand has predicted that the demand for copper will surpass its supply by the latter half of this decade. The price of copper has already increased by 28% since the start of the year, largely due to its critical role in renewable energy solutions. Unpredictable supply stemming from geopolitical issues and labor disruptions in major copper-producing nations further threatens the balance between supply and demand.
The global transition towards electrification has resulted in an increased demand for copper. Copper plays a key role in several sectors, from electric vehicle manufacturing to solar power panels, wind power farms, data centers, and military applications.
Copper demand outpaces supply, prices to climb
The metal’s broad use across these sectors contributes to the rising demand for copper as global decarbonization and digitization efforts intensify.
Andurand has also highlighted potential in other commodities such as aluminum. He does not anticipate a significant rise in crude oil prices, as geopolitical risks have not critically influenced the supply chain. The notable trader also believes there is untapped potential in the renewable energy sector despite uncertainties in the fossil fuel market.
Recently, U.S. copper futures experienced a decrease, following eight weeks of consecutive gains. This coincided with reductions in May Comex gold and silver rates. These fluctuations in commodity markets continue to shape discourses among investors and analysts.
Andurand’s viewpoint on copper’s increased demand is widely concurred with by industry experts. However, they caution that current indicators may suggest an overestimation of copper prices, posing the substantial risk of a significant price correction.
