Global copper long-term outlook Q4 2019

Global copper demand growth in 2019 has been weaker than expected, reflecting a deterioration in the global macro economic landscape. A recovery in the global economy in 2021 will support a rebound in copper demand, a year earlier than in our September 2019 LTO. However, a wave of new mine supply between 2020 and 2023 will push the market into surplus over this period. As a result, rising inventories will see copper prices under pressure from 2021 and we expect cash quotes to succumb to an annual average low by 2023. As stocks start to decline and deficits return, prices will begin to trend higher. Rising prices should provide sufficient confidence to encourage producers to sanction some of the larger (greenfield) projects that will need to be developed in order to close the supply gap that is set to emerge over the medium to long term.