$3.50/lb copper is possible before 2024 ends, warns Scott Pollan

Increased supply and poor economic conditions over the short term could hurt copper, said Scott Pollan, president of Emergency Material Services.

On Thursday Pollan spoke to Kitco Mining.

Pollan predicts a near-term decline, potentially reaching below $3.50 by the end of the year, and a possible revisit of 2022 lows in early 2025. He attributed the decline to weakening demand and increasing supply. However, Pollen remains bullish on copper long-term, citing the millennial consumption cycle and the ongoing electrification trend as key drivers for future demand. He also highlights the challenges in building new copper mines, which could further constrain supply and push prices higher.

Despite challenging headwinds for the metal over the short term, that hasn’t diminished M&A. In 2024, there were some monster copper deals. This summer BHP Group and Lundin Mining bought Filo in a $3 billion copper deal. Earlier this year BHP Group tried to acquire Anglo American for its South American copper assets. The offer size reached $49 billion.

Pollan said there is a rush for tier-one copper assets as the big miners try to show investors they have a long-lasting, reliable supply.

"[It's a] rush to buy tier one assets by major producers," said Pollan "They need to assure their investors that they have secured a supply of raw material for the long-term future. In my opinion, we'll see more [M&A] for smaller producing facilities as tier one producers really try to build up their book of supply."

0:00 - Copper prices headed lower
1:44 - What's the outlook for demand?
2:31 - How do you gauge what is happening in China and impact upon copper?
3:33 - Are the big, traditional copper mines really slowing down? What's the outlook?
4:34 - Do we need a better incentive price for copper?
5:35 - Despite copper coming down substantially from earlier in the year, the big miners are making big copper bets. Talk about M&A highlights?
7:33 - Why is building a big copper mine more challenging than building a gold mine?
8:44 - Is anything happening on the technology side that could be meaningful to copper?
10:44 - What are some of the big milestones you are watching in the copper sector over the next 12 months?

__________________________________________________________________

Kitco Mining is dedicated to reporting on the mining industry. Our mandate is to be the top resource for all mining information and news, offering a clear perspective on where the industry is going through breaking news coverage, mining trends, and in-depth reporting, presented with precious, rare earth, base metals, and industry stock prices.

Stay connected with us

Connect with the Kitco Mining anchors


Disclaimer: Videos are not trading advice, and the views expressed may not reflect those of Kitco Metals Inc.

[johndrumheller]

This guy knows his commodities and their markets. Excellent insight into what affects use and price - and ultimately what liquidity providers will do. I’m glad I watched.

[ProgressiveMountain]

Dr Copper - World Markets measuring stick

[chesterstock]

Good to know being long SIZ and knowing silver is following copper. Thanks for the info!

[dassa]

The Supercycle will only resume subsequent to termination of The Grater Depression and establishment of a universal gold based currency.

[loco]

This guy is a recycler. Doubt he has any special insight into the worldwide copper market.