Goldman Sachs Bullish on Copper Prices as Increased Use of Electric Vehicles Boosts Copper Demand

Published: Jul 7, 2023 18:16

Save

According to foreign media on July 6, Goldman Sachs said that the increase in the use of electric vehicles (EV) is a "key driving factor of bullish copper prices". It is expected that the industry's copper demand will reach 1 million mt this year and will increase to 1.5 million mt in 2025.

"Due to its high electrical conductivity and ductility, copper is ideal for power conversion and transmission in electric vehicles," the bank said in a note on Wednesday.

Electric vehicle production accounted for about two-thirds of the increase in global copper demand last year and could account for about 27% of new copper consumption over the next 10 years, the bank said.

Goldman Sachs said its analysts are bullish on EVs, expecting “strong sales in China through the remainder of 2023, driven by lower EV prices and higher demand.”

Benchmark copper on the London Metal Exchange (LME) fell 7.5% in the second quarter of 2023 amid a slow recovery in Chinese demand and concerns over global growth.

However, copper use in EVs is likely to decline in the longer term, with copper use likely to drop to 65kg per EV by 2030, compared with 73kg in 2022, the bank said.

Market forecast

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

For any inquiries or to learn more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

1 hour ago

Chile's Water Crisis Threatens Atacama's Copper and Lithium Mining Amid 14-Year Drought

Chile’s most pressing crisis at present is the issue of water resources. The Atacama Desert in Chile is one of the driest regions in the world and also the core area for copper and lithium ore extraction. The local area has experienced a drought for as long as 14 years, and reservoir storage has fallen to only about 30%. For miners, water resources are not a secondary issue, but an indispensable key production factor in such processes as ore processing, dust suppression, and equipment cooling. The decline in ore grade has further exacerbated the predicament

1 hour ago

Trump Adjusts Metal Tariffs, Applies 50% Rate to Consumer Prices Under Section 232, Details Unclear

US President Trump adjusted the national security tariffs on imports of steel, aluminum, and copper, lowering the tariff rates on derivative products made from these metals, streamlining compliance procedures, and preventing the declared value of imports from being understated.A senior Trump administration official said that, under a proclamation signed by Trump, the US would continue to maintain a 50% import tariff on imports of metal commodities such as steel, aluminum, and copper pursuant to Section 232 of the Trade Act of 1974, but would apply this rate to the price paid by US consumers. It is currently unclear how the selling price—and the resulting tariffs—would be determined.

1 hour ago

Barrick Confirms 2028 Production Target for Reko Diq Copper-Gold Project in Pakistan Despite Budget Concerns

Barrick Mining said that its Reko Diq copper-gold project in Pakistan still plans to achieve first production by the end of 2028.The project is a large-scale copper-gold project jointly developed by Barrick, the Pakistani government, and relevant joint venture partners, and is located in Balochistan, Pakistan. Although the company had previously warned that the capital budget previously disclosed for the project's two phases could face a significant increase, the 2028 production commencement target remained unchanged.

1 hour ago