The transition towards a greener and more sustainable world is opening up immense possibilities for various metals. Amongst this outlook, copper is emerging as one of the metals of enormous strategic nature. The metal by the virtue of its high electric and heat conductivity is extensively used in a variety of items, including electric cars, smartphones and other electronic appliances.
Its high usage in sectors like construction, transportation and electronics industries and the fact that demand for copper is frequently used as a gauge of economic expansion is responsible for its title of “Dr Copper”. The title highlights its nature as a leading indicator of the state of the world economy.
Copper: a metal fueling global green transition
Apart from its conventional use, the use of copper in renewable energy technologies like wind turbines and solar panels holds immense potential, especially in today’s time of global green transition.
However, the major proportion of its new-age usage is coming from the growing electric vehicles (EVs) market because the production of EVs requires significantly more copper than traditional vehicles.
Based on these usage and green transition, copper enjoys the status of a hot-shot metal in today’s commodity space.
Copper crunch in global market: a factor impacting its supply and prices
As discussed above, the widespread usage of copper in various important industries is fueling its demand in the global commodity markets. However, being a finite resource and due to the global supply chain issues, there exist a gap between its demand and supply.
This uneven nature of demand and supply along with concerns about future copper shortages backed by geopolitical events, natural disasters and trade tensions has led to its sharp volatility in metal market.
Trading in copper
Around the world, copper is traded on a number of exchanges; this includes the London Metal Exchange, the Shanghai Futures Exchange, and the New York Mercantile Exchange. In India trading in copper takes place via futures contracts which are available on the Multi Commodity Exchange of India (MCX).
In conclusion, copper is a vital commodity that is traded in global markets and plays a crucial role in modern infrastructure and technology. With growing demand and a finite supply, copper is expected to remain a valuable commodity in the future, making it an attractive investment opportunity for those looking to diversify their portfolios.