Commodities: Copper
Base/industrial metals Copper (Cu) and Aluminium (AL) are two commodities that are benefiting from increasing demand for data centres and global electrification. While the specific uses for the two metals are different, their correlation is extremely close, as can be seen from the chart below, but their differences are understood by most investors:
Copper slipped lower last week as the US Dollar advanced to fresh 12-month highs. Short-term the industrial metal continues to rotate in a relatively tight trading range, in very similar fashion to the ASX200. We’re targeting an advance towards US$15,000/mt in the coming months but a softer Dollar may be required to set off the next wave of buying.
Hi Team,
Many thanks for the very informative CSC webinar today and the effort you guys put in to give us honest and sincere opinions.
Could you please give your choice between BHP & RIO with your reasons.
Thanks.
Shabbir
Copper is MM’s key commodity pick in the current cycle as we discussed in this week’s webinar (recording here), but as we said at the time, even the strongest bull markets don’t go up in a straight line. Overnight copper bounced ~2% after a sharp pullback earlier in the week.
Copper slipped lower last week on concerns that rising interest rates would weigh on global growth plus a stronger US Dollar as the Fed became more hawkish created an additional headwind. We will discuss copper in this week’s webinar as we cover the potential for a commodities Supercycle. The industrial metals strength in 2026 reflects a rare combination of robust long-term demand growth and constrained supply.
Copper recovered strongly last week and looks on course to make new highs in the coming weeks – again this morning’s peace deal will help. While we are very conscious that “long copper” is fairly crowded, we remain bullish believing surprises are likely on the upside.
Sandfire (SFR) is the largest pure copper (Cu) play on the ASX, although BHP has arguably been more correlated to the industrial metal. There are two points of note from the impressive chart below:
Good Morning Gents,
I’ve been out of range for a while only to come home to see my commodity stocks being slaughtered (gold, silver, copper, nickel, uranium) in direct contrast to all the talk of a commodities super cycle. I have a mix of explorers, developers and producers but none have been spared. Can I have both your diagnosis and prognosis for this sorry malady?
Thank you once again. You guys have proven to be head and shoulders above other analysts I’ve used.
Copper looked on course to punch above $US14,000 last week before interest rate concerns weighed on the industrial metal. We continue to target fresh highs above US$15,000/t as global supply struggles to keep pace with demand from AI infrastructure and the broader electrification trend.
