A top commodities analyst said copper is emerging as the next indispensable industrial commodity, mirroring oil's surge in earlier decades.
According to Jeff, this time new forces in the economy, namely the advent of artificial intelligence, the explosion of data centers, and the green energy revolution, are driving demand for copper, while the development of new weapons is also increasing it. Is. Currie, chief strategy officer of Energy Pathways at Carlyle.
“Copper is the new oil,” he told Bloomberg TV on Tuesday, noting that his conversations with traders also bolstered his bullishness. “That's the most belief trade I've ever seen.”
Copper has long been an important industrial metal as its uses range from manufacturing and construction to electronics and other high-tech products.
But pouring billions of dollars into artificial intelligence and renewable energy is a relatively new part of copper's outlook, Currie noted, acknowledging that he made a similar prediction in 2021 when he was an analyst at Goldman Sachs. were
“I believe it's liftoff time, and I think we're going to see more momentum behind it,” he said. What's different this time is that there are now three sources of demand — AI, green energy, and the military — instead of just green energy three years ago.
And while demand is high, supply remains tight because it can take 12 to 26 years to bring new copper mines online, Currie pointed out.
He predicted that prices would eventually rise to $15,000 a tonne. Copper prices are already at record highs, with benchmark prices in London around $10,000 a tonne, more than double the pandemic-era lows of early 2020.
At some point, the price will become so high that it will cause a “destruction of demand,” meaning that buyers will stop paying that much. But Curry doesn't know what that level is.
“But I go back to the 2000s, I was as happy with oil as I am with copper today,” he added, noting that the price of crude rose from $20 to $140 a barrel at the time. was “So the copper upside is very important here.”
Copper was also a key catalyst in BHP's proposed Anglo American takeover, a $40 billion deal that would make the world's top copper producer. But Anglo rejected the offer and recently announced plans to restructure the group, including selling its diamond business to De Beers.