Experts estimate a deficit in the metals market for the following years.
Portal Minero. See the original note HERE (spanish only).
Close to US$ 3 pound has been the copper price these days. A high price in comparison with the average US$ 2.64 in 2018. However, there is an inventory data call LME from the London Metal Exchange that announced metals could rise its prices during the next days. Yesterday, the prices fell in 116,875 metric tons which experts say it would be 2 days of consume. This have been the lowest prices in more than 10 years (May 8th 2008) 110,125 metric tons.
Juan Carlos Guajardo, Executive Director from Plusmining, mentioned that the inventory data fall is not related with the price. He adds “The fall we are seeing is the reflex of a great copper demand despite the financial and macroeconomic uncertainty, as well as the supply issues”.
The executive vice-president of Cochilco, Manuel José Fernández, says the fall in the inventory data is related with three main factors: first, the copper consumption from China keeps growing in a solid way; second, the deficit in refined copper in the world; third, the interruptions in mining industry from China, India and Chile; countries who has refine copper.
Álvaro Merino, CEO from Sonami Studies, explained that the inventory fall reflects shortage in the market and this is how it will be in the following years, “Analyzing the market fundamentals, this is demand and supply, and deficit is projected for 2019 and 2020, increasing in 2021 and 2022 so higher copper prices will be seen” says Merino.
This is how the inventory data fall is a signal for the cooper price. Even though yesterday a decline of 0.74% until US$ 2.95 pound was observed. Analysts predict prices will be high due to the market conditions and uncertainty will decrease. “For 2019 copper price will uptrend due to the positive expectative in the negotiation between United States and China, says Fernandez from Cochilco.