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The state-run Chilean Copper Commission (Cochilco) announced on Monday that it was raising its forecast for copper prices in 2024 to $3.85 per pound, up from $3.75 per pound, for the Federal Reserve will switch from raising to lowering interest rates in 2024, plus the energy transition continues to spur copper demand growth. The agency expects global demand for copper to grow by 3.2% in 2024 to 26.13 million tonnes.
Cochilco expects copper to average $3.85 a pound this year and $3.90 a pound next year. In Monday’s session, the price of the futures copper contract on the New York Mercantile Exchange was at $3.78/lb.
Cochilco stressed that the upward revision of the price forecast took into account factors such as the normalization of monetary policy in the United States, but was mainly due to the energy transition and the demand for electric vehicles, “all of which are favourable conditions that allow us to anticipate good expectations for the copper price”.
Global copper production is expected to grow by 5.8% this year to 22.79 million tonnes, outpacing demand growth of 3.2%; it will rise to 23.5 million tonnes in 2025, Cochilco said. Among them, Chile’s copper output will grow by 5.7% this year to 5.63 million tonnes, thanks to increased production from Teck’s Quebrada Blanca Phase II project, and by 6.4% next year to 6 million tonnes.
In 2024, Chile is expected to retain its position as the world’s largest copper producer, while the Democratic Republic of Congo will become the second-largest copper producer this year, with Peru dropping to third place.
Cochilco expects the global copper market to have a surplus of 176,000 tonnes in 2024 and a projected 170,000 tonnes in 2025.
