Copper prices to average lower in 2015, surplus to surge, says Cochilco

SANTIAGO (Scrap Monster): According to Chilean Copper Commission (Cochilco) estimates, the copper prices may average even lower in 2015. Meantime, copper surplus may grow significantly. The outlook for copper doesn’t look bright, say analysts too.

According to Cochilco, the average price of copper is estimated at US $ 3 per pound in 2015. The copper surplus may expand by 16% year-on-year to touch 416,000 tons in 2015. The 2014 price forecast for copper was kept unchanged. Cochilco had earlier predicted the copper prices to average at $3.15 per pound in 2014. It also forecasts a 3.8% jump in global refined copper demand in 2014.

Analysts too suggest weaker price for copper. According to Goldman Sachs, LME copper prices may average at $6,850 per metric tons, or about $3.11 per pound in 2014, which is lower than the estimated average of $7,328 per metric ton, or $3.32 a pound in 2013. The prices will decline further in 2015 to average at $6,600 per metric ton. Also, copper surplus will touch 385,000 metric tons this year.

Demand growth from China, which accounts for nearly 44% of the global copper consumption may provide some support to prices. The economic recovery in the US and the Europe may also prevent a drastic price fall. However, generally, the copper prices are expected to soften further as production growth exceeds consumption.