Like the lithium prices in 2022, copper prices are also on the rise and facing high demand with limited supply. This is why copper mining stocks listed on the Australian Securities Exchange (ASX) are gaining attention from investors.
In 2024, copper prices have reached $9418 per ton, showing an increase of over 10%. Many analysts predict that copper prices will continue to rise for some time. This is good news for shareholders of Aeris Resources Ltd (ASX: AIS) and copper mining stock Sandfire Resources Ltd (ASX: SFR).
The ASX copper mining stocks are benefiting from improved sentiment regarding prospects. Apart from its wide industrial applications, copper’s conductivity makes it a crucial element in the world’s electrification processes. The booming development of artificial intelligence and data centers supporting this industry is further fueling this trend.
Saad Rahim, Chief Economist at Trafigura, mentioned regarding the copper market, “We are adding more sources of demand. First it was energy transition, now it’s data centers and AI. This growth has suddenly exploded.”
Max Layton, Global Head of Commodities at Citigroup, believes, “We think the copper bull story is still unfolding.” Layton’s fundamental assumption is that by 2026, copper prices will reach $12,000 per ton. However, if cyclical demand grows at a faster pace, copper prices could surpass $15,000 per ton, around 60% higher than current levels. In the next two to three years, if there is a strong cyclical recovery, copper prices could experience explosive growth.
Aeris, a small-cap miner valued at $198 million, is in the phase of turning losses into profits. While its stock price had dropped by 60% since this time last year, it has surged by 95% in the past month.
Recently, investor enthusiasm has been sparked as Aeris reported that its joint venture Canbelego copper project holds significant potential for copper resource growth.
Sandfire Resources, a larger and more established player in the ASX top 200 copper mining stocks with a market capitalization of $4.2 billion, has seen a 35% increase in its stock price over the past 12 months and a 45% increase over the past 6 months.
Although this top 200 ASX mining company also mines zinc, lead, gold, and silver, 74% of its revenue in the first half of the 2024 fiscal year came from copper. If copper prices continue to rise as predicted by Citigroup, Sandfire’s stock could continue to generate excess returns in 2024.
