COPPER prices have hit the US $7,000 per metric tonne threshold for the first time since 2018, representing a two-year-high, following Chinese economic recovery and a resurgence in demand for the red metal.
Data from RMB Global Markets and Bloomberg revealed that prices of the commodity had touched the psychological barrier of US $7,000 since 2018 after demand from China, the world’s largest consumer of the red metal, surged.
“Copper surpassed the US $7,000/mt mark yesterday (Thursday) for the first time since 2018, implying that the red metal is 12 per cent up this year. The price increase is partly driven by the Chinese economy, which grew by 4.9 per cent in Q320. Over a multi-year period, copper prices could surge as electric cars become the norm, given that these vehicles contain three times more copper than internal-combustion cars. This implies that major African copper exporters like the DRC and Zambia could reap the benefits through higher export earnings and potentially stable exchange rates,” data shows.
The last time prices of the red metal soared past the US $7,000 mark was in June, 2018, where the commodity sold at an average US $7,150 per tonne.
This latest price jump follows a global economic meltdown that had been suppressed by the Coronavirus pandemic, which led to prices slump to as low as US $4,617 per tonne in the first quarter of this year, according to the London Metal Exchange (LME).
Prices started this year on a bullish note, trading at over US $6,300 per tonne amid optimism of the US-China trade deal breakthrough, hitting a high of US $6,300.50 per tonne by mid-January.