Copper news, page-146

Here is further confirmation of the looming copper shortage.

Here are a few extracts from an article in TheAustralian today based on an interview with copper hopeful Coda Minerals and top boss CEO Chris Stevens.

We need lift in copper prices, exploration as deficit looms, says Coda Minerals boss Chris Stevens

Q: Just how hard is it to find a copper deposit?
A: Even harder when you’re not looking.
And that’s what’s worrying Coda Minerals (ASX:COD) CEO and executive director Chris Stevens, who calls the lack of exploration for the red metal “crazy”, with supplies “drying up” as demand continues to increase.

“I personally think copper is the best place you could possibly be working right now in any commodity,” he said, predicting a price surge ahead.

S&P Global, one of the world’s leading price agencies and commodity forecasters, says demand for copper could double from 25Mt in recent years to 50Mt by 2050.
Yet exploration budgets have become smaller since the last boom.
After peaking at $US1.41 billion in 2012, by 2021, as copper prices hit all time highs of $US10,700/t and more, major miners were putting just $US820.8 million into the hunt for the red metal.

A 41 per cent plus fall in nine years, it is a stark reminder that the homework needed to power the energy transition is being set, but not completed.
In that context, those in the field say prices will need to go higher to encourage investment in mines that previously would not have been developed, with most of the large, easy discoveries already made.
At $US8922/t on Monday prices are already at levels considered strong by historical standards. For explorers with their ducks in a row, this is a good position to be in.
And new supply is desperately needed, Stevens, a mineral economist by training, warns.
“There would have to be a discovery equivalent to five to 10 Escondidas to fill in the deficit,” he said.
Escondida, owned by BHP (ASX:BHP) and Rio Tinto (ASX:RIO), is the world’s largest copper mine, producing over 1Mt of metal a year in Chile.
“The chance of that discovery, in my opinion, is as close to zero as anything could possibly be because the dollars are not being spent on exploration,” Stevens said.
“You can’t find something you’re not looking for.

Something that I noticed from the presentation that you put out. In it you mentioned that copper exploration expenditure is at lower levels than it was several years ago. Given the demand requirements for copper going forward for new applications that just seems crazy to me.

“Yeah, it’s insane. The thing that people really don’t get about copper at the moment, copper’s always been called Dr Copper and it’s got a very strong correlation to world economic sentiment and macro factors.
“The interesting thing is that under normal circumstances, you would expect the price to completely disintegrate because you’ve got inflationary pressures all over the world, you’ve got copper’s largest consumer in China (having problems) – and bear in mind 50 odd per cent of copper consumption goes into Chinese infrastructure and buildings.
“They’ve just basically unleashed Covid on the entire population, seem to be coming through well, but you would have an absolute perfect storm of bad macroeconomic factors that would normally have copper down much lower than it is now.
“It’s still hovering around historic highs. Why is that? Because supply is drying up, demand is increasing due to the requirements of electrification, but demand is actually somewhat muted compared to what it would be were it not for the difficult macro factors.

“So we’re sitting there around $US9000 a tonne at the moment. The forecast is to go significantly higher and I said on the webinar, if I was talking to you in 2004 and I said that the iron ore price would go to $US220-240 a tonne – given the fact that it averaged about US25 bucks a tonne for the last 20 years – you would have laughed me out of the room.
“But in reality, that’s what it has done. Oil has done a similar thing. So copper is a big market, $US200 billion, it takes a lot to move it. The reality is right now I think 1 per cent of copper demand is in EVs, it’s forecast to go up something like 30 per cent.