Global copper short-term outlook January 2021

Since hitting a peak early on in January, copper prices have come under pressure through the month as a risk off tone has now set in. Despite a consistent decline in visible exchange stocks, rising virus cases and a tightening in Chinese credit availability amid concerns about a property bubble point to an increasingly cloudier outlook for demand this year. Despite robust mine supply growth in 2021, the recovery in demand will keep the market finely balanced and we expect prices to rise on an average annual basis. Nevertheless, we maintain our view that the market is headed for a period of oversupply from 2022 following several years of above average mine supply growth. Prices should yield to the surplus that are anticipated to emerge in the refined market.