As with many other metals, 2015 hasn’t been a great year for copper. The metal is currently trading around $2.14 per pound, above the year’s lows, but far below where copper prices started the year, at about $2.90 per pound.
Still, there’s been plenty of copper news to watch this year. Between troubles at BHP Billiton’s (NYSE:BHP,ASX:BHP,LSE:BLT) Olympic Dam operations, heavy rains, flooding and an earthquake in Chile, and production cuts from major copper mining companies, there’s been more than enough copper news to keep investors on their toes.
Here’s a look at some of our top copper news stories from 2015:
| Updated December 2015
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1. Could China use Aluminum Instead of Copper Wiring?
In early June, China’s National Energy Administration (NEA) released nationwide industrial standards for the use of low-voltage aluminum alloy cables. China has ample aluminum supply, but needs to import most of its copper. Aluminum is also much cheaper than copper, which had some market watchers wondering whether China could use aluminum instead of copper wiring for some of its larger projects.
However, there are some issues with aluminum wiring that could make that scenario unlikely. For example, aluminum wiring has been linked to house fires, and overall, copper’s physical properties are much more favourable for China’s big grid infrastructure projects. Learn more about aluminum vs copper wiring here.
2. Morgan Stanley Copper Price Outlook
Back in March, Morgan Stanley (NYSE:MS) noted that things weren’t looking so good for copper prices. The firm pointed out that seasonal demand from China had failed to pick up as expected, denying copper a much needed boost. The red metal fell near the end of 2014 in response to collapsing crude oil prices, and also to “aggressive China-based hedge fund selling.” Read more here.
3. Copper Price Forecast 2016: Producers Under Pressure
Despite being published closer to the end of 2015, our look at the copper outlook for 2016 was one of our top-read copper news stories of the year. For the most part, analysts are not expecting copper prices to move higher in 2016. However, Stefan Ioannou of Haywood Securities noted that continued low prices would put added pressure on producers to cut copper output. Read the full outlook here.
4. Will Copper Prices Fall Below $2 per Pound?
Copper prices haven’t sunk below $2 per pound yet, but they were getting awfully close near the end of November. Ioannou agreed that the $2 mark would be an important psychological level for many people, but noted that, at that price, roughly 20 percent of the world’s producing copper mines would no longer be economic. Click here for the full article.
5. Glencore Closes Below 1 Pound
Far from simply affecting junior mining companies, this year’s commodity price rout has weighed on some of the world’s largest miners as well. In mid-November, the biggest copper news was that Glencore (LSE:GLEN) had seen its share price close below one pound for the second time in 2015. Analysts blamed weak copper prices for the downfall. Currently, Glencore shares are trading near 90 pence. Read the full article here.
Securities Disclosure: I, Teresa Matich, hold no direct investment interest in any company mentioned in this article.