China stockpiles copper triggering its meteoric rally
The growing demand for copper can be compared to one for bitcoin. Additionally, its recent rally may push the price to new heights in the very foreseeable future.
Currently, many countries are increasing their copper production or reserves. Importantly, millions of tons of copper will be needed in many segments of the energy industry in the coming years, primarily in renewable energy and in the construction of charging stations for electric-powered cars. What is more, this metal is used for the production of electric vehicles, in the telecommunications industry and the electronics industry, etc. Demand has been steadily rising since the beginning of the pandemic when the cost of a ton of copper on the LME was $4,600. On April 1, 2021, its price hit $8,860 per ton.
Sooner or later, humanity will ultimately defeat the coronavirus. Countries will need various goods and raw materials for production. This is why some governments are now actively buying up raw materials. This approach will definitely bring them a great advantage in economic competition. As for copper, China is taking the lead. Only last year the country imported 6.7 million tons of unprocessed copper, which was 30% higher than in 2019. However, China did not stop on imports. According to various sources, Chinese firms bought several production assets in different parts of the world, as well as a number of companies that sell, among other raw materials, copper.