Copper price rally is far from over. That is according to analysts at Eurasia Group, one of the biggest consulting firms in the world. The price of copper is now trading at $2.6430, which is slightly below yesterday’s high of $2.6720.
Copper demand set to rise
Copper price is set to roar back after years of being a laggard. According to Henning Gloystein, demand of the metal, coupled with supply shortfall could lead to a significant rally. On demand, he pointed the various government investments that are meant to stir growth. He argues that these investments items like electric vehicles, 5G, and renewable power will lead to a sharp increase in copper demand.
Still, he believes that demand will fall by about 5% this year and then start rising in 2021 as these investments rise. He said:
“Huge green and digital stimulus programs, especially in Asia and Europe, will create the conditions for a boom in copper demand — electric vehicles, 5G networks, and renewable power generation all require large amounts of the red metal.”
Eurasia Group is not the only big firm to raise its copper price target. In a report earlier this month, analysts at Bank of America said that the price would jump by 5.6% a ton this year. They expect the price to shoot to $6,250 in 2021. Similarly, those at Morgan Stanley have raised their target for the metal.
Another factor that could push