Foreign media on January 7 news, according to Fitch Solutions' BMI analysis agency forecast that in the next two years, international copper prices will rise by more than 75%. The main drivers behind this forecast include supply disruptions, rising demand and the development of the renewable energy sector.
First, a disruption in global copper supply could have a significant impact on copper prices. In addition, with the rapid development of the renewable energy industry, the demand for copper is expected to increase significantly. This increase in demand is closely related to the trend of global energy transition, as copper has an irreplaceable role in renewable energy equipment and power transmission systems.
In addition, the report also pointed out that the Federal Reserve is likely to cut interest rates this year, which will cause the dollar to weaken. Since copper prices are usually denominated in U.S. dollars, this allows foreign buyers to purchase copper at a more favorable price. This expected currency dynamic also supports the forecast of higher copper prices.
At the recent COP28 climate change conference, more than 60 countries backed plans to triple global renewable energy capacity by 2030. This policy orientation is expected to further drive demand growth for copper, which in turn has a positive impact on copper prices.
Analysts at Citibank are optimistic, and they see this scenario as extremely positive for the copper market. The bank forecasts that global copper demand will increase by 4.2 million tonnes by 2030. If this prediction comes true, then copper prices could reach an all-time high of $15,000 per tonne by 2025.
Overall, a combination of factors is expected to drive international copper prices significantly higher over the next two years. From supply disruptions and rising demand, to developments in the renewable energy sector and changes in currency dynamics, these factors have had a significant impact on the direction of copper prices. However, market dynamics are complex and changeable, so investors and related industries should pay close attention to the development of these factors in order to better grasp market opportunities and risks.
