SUMMARY

Since March, the price of copper, which is used in everything from computer
chips and toasters to power systems and air conditioners, has decreased by
almost a third.
Investors are selling due to concerns that a global recession will limit demand
for a metal linked with growth and expansion.
You wouldn't know it by looking at the market today, however, some of the
world's major miners and metals merchants are warning that a significant
shortage of the world's most crucial metal could develop in a matter of years,
possibly limiting the global economy, driving inflation by rising manufacturing
prices, and derail global climate objectives.
According to an industry-funded S&P Global assessment, when the world goes
electric, net-zero emission goals will quadruple demand for the technology.
According to Goldman Sachs, the benchmark London Metal Exchange price
would nearly quadruple to an annual average of $15,000 per tonne in 2025.
While copper has fallen from its March high, it is still trading around 15%
higher than its 10-year average.
According to S&P Global, the recycled output will account for around 22% of
the overall refined copper market by 2035, up from approximately 16% in
2021.
Citigroup Inc. expects copper to decline in the next months as a result of a
recession, particularly in Europe.
Also important will be the forecast for demand from China, the world's largest
metals consumer.
Chile, Peru, and the Democratic Republic of the Congo account for more than a
third of the world’s copper output. At mature mines, production problems
mean output drops or more rock must be processed to generate the same
quantity. Mining businesses in the United States are encountering permitting
challenges.
Obtaining permissions for new projects is becoming increasingly difficult.
Producers are under pressure to maintain robust balance sheets and reward
investors.
Because of the long lead time for mines, the supply forecast is very much set
for the next decade. "The short-term issue is adding to the longer-term
picture," Adkerson adds.