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Copper demand to remain strong: Labuschagne
Over the past month copper prices have fallen to 16-month lows, with three-month copper contracts on the LME down to US$8381/t on Friday.

That is down around 20% from all time highs a little over a year ago above US$10,700/t despite supply side issues in Chile, the world’s largest copper producing nation where labour strikes have become increasingly commonplace most recently at Codelco, the leading miner globally.

Copper stocks at metal warehouses of last resort are also low, but poor demand from the commodity’s main consumer China has weighed on the commodity price as Covid-related lockdowns have slowed its economy.

Mining equities have also been impacted by inflation, the consequence of rising interest rates and nervous markets following Russia’s invasion of Ukraine.

But prices remain high in a historical sense, and Labuschagne says the outlook for copper remains very strong given its role in decarbonisation and electrification.

“I don’t get involved with copper forecasts or commodity forecasts because we tend to get it wrong all the time,” he said.

“But you just look at the metrics in terms of supply and demand for copper it is very strong, so you would argue that there’s a good future for copper. And I know there’s a lot of interest from investors, specifically into copper companies.

“Will being in copper be better than other commodities, it’s hard to say, there’s a lot of other commodities also driven by this drive on sustainability and renewables.

“So we are just in a position now we’ve got operating assets in a very good price environment.”

With those long-term drivers for copper demand still intact, Labuschagne said it’s important investors don’t get lost in the short-term struggles Aeris and other companies are having in the current market.