Chart from 1900 to 2021 (Real vs Nominal copper prices), with...

Chart from 1900 to 2021 (Real vs Nominal copper prices), with annotations

Copper is colloquially referred to as Dr Copper because of its ability to predict the turning points of the global economy, with copper market activity used as a lead indicator for global economic cycles.







The graph below suggests the current copper rally may have legs for a few years yet (IMO, it will be decades).




In real terms copper has traded higher than today during at least five periods.

Goldman Sachs believes that the 'green revolution' is likely to create a record wide copper supply gap by 2030, as not many big new copper projects are coming on stream. Given the long-cycle nature of copper, the Goldman added, “copper supply may not be readily available to meet copper demand by the second half of the decade.”

Developing copper mines is not getting any easier.

Goldman Sachs, the number one proponent of the existence of a 'supercycle' in commodities, sees more copper gains during 2022, predicting prices to reach US$12,250 per tonne (US$5.55/lb) by the end of next year. Goldman Sachs' opinion, the copper price could go as high as US$15,000 per tonne (US$6.80/lb) by 2025.

Note: little known fact, copper (real) prices were actually at their highest just prior to the American Civil War (1861-1865).

Cheers

These are only my thoughts and it does not constitute investment advice. Before acting on any information you read and before making any financial or investment decisions, you should always consult your advisor(s) or other relevant professional experts.