Copper’s supply crunch will drive prices to $13,000 or even $20K – Bank of America

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(Kitco News) – Copper‘s unprecedented run to a 10-year high of $10,000 per tonne on the London Metals Exchange (LME) could just be the start of a much larger uptrend, according analysts at Bank of America.

In a report Monday, the bank’s analysts said that they could see copper prices rallying to $13,000 a tonne as the market continues to see a significant supply crunch and growing demand. Copper prices on the LME are currently trading at $9,932.50 a tonne , down 0.32% on the day.

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The analysts noted that the copper supply, as measured by inventories in LME warehouses, is at its lowest level in 15 years. They added that stocks could currently cover 3.3 weeks of demand.

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“The fundamental backdrop is so concerning because the global economy is just now starting to open up and reflate,” the analysts said. “With LME inventories close to the pinch-point at which time spreads can move violently, there is a risk backwardation, driven by a rally in nearby prices, may increase.”

www.kitco.com/news/2021-05-05/Copper-s-supply-crunch-will-drive-prices-to-13-000-or-even-20K-Bank-of-America.html

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