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Copper - Worth its weight in Gold? |
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As one of the “workhorses” of technology and industry copper, has long been a popular choice for investment. Its popularity never wanes and demand grows year by year. Today’s economic climate world wide has only increased the demand to invest in copper. Countries stockpile it whenever possible as the use for this valuable metal will only increase with time. Currently copper has reached an all time high and is considered to be an excellent investment opportunity along with gold, nickel, silver, and tin. In fact gold, which has been the top earner for the past several years is now declining somewhat while silver has shown strong gains due to recent high demand and lower available quantities of it. Silver mining is on the rise and may soon match copper in desirability, if not pricing.
Stockpiles only make the investment more worthwhile
In recent years many countries have tried stockpiling huge quantities of precious metals such as copper as a hedge against inflation. The heavy usage of copper has kept these forward thinking countries ahead of the game somewhat but they must constantly replenish their hoards or will soon run low and need to buy, perhaps when prices are higher than before. According to the London Metal Exchange copper has peaked out somewhere over nine thousand dollars for a metric ton. This realizes a thirty percent rise in its value this past year. Those countries that chose to keep their stockpiles on the low side have helped raise values of not only copper but other precious metals as well.
High demand usually translates to soaring prices
As an industrial commodity copper, along with other metals such as nickel, aluminum, tin, and zinc will always be in high demand due to their many uses in construction and technology. Copper has several grades, some of which are more valuable than others. Standard grade, hydro, and high grades are determined by the purity of the metal. With inventories lower than expected (by one third) copper has reached new highs globally when demand exceeds the available amount. China has managed to stockpile large quantities of copper but may soon run low due to high demand and use this year.
Mining needs to increase to meet high demands
Not only is copper in high demand but many other industrial type metals are not being mined in sufficient quantities to meet the ever growing demands, especially as the economic crisis lessens and more need is found. Mining the ores needed to manufacture these metals is once again becoming profitable and creating even more jobs on the lower qualification levels. The need to keep manufacturing costs down is evident when prices fluctuate as is common when demand peaks. Scrap copper and other metals are in high demand and prices have risen accordingly. Theft of copper is an unavoidable occurrence that comes with high prices and high demand. No longer can constructions sites be left unattended with copper plumbing just lying about.
Copper vs Gold in a “throwdown” for demand
While copper may never reach the astronomical prices that gold has seen in recent years (well over $1400 per troy ounce), its demand will never wane and at somewhat over $4 per pound or around $9400 per ton the stockpiling will continue. Copper after all is needed by the pound while gold usage is called for in ounces or less.
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