Corona virus and copper
Standstills and disruptions in demand in China are causing concerns for copper investors. In fact, it would not have looked so bad for the economic metal. Trade disputes between the US and China have developed positively and the manufacturing sector seemed to be recovering. But the optimistic outlook for the copper price has now clouded over.
How strongly the virus epidemic will affect China's gross domestic product is still uncertain. However, it is assumed that the peak phase of infection will soon be reached and overcome. The copper price fell in January and was able to recover somewhat in February. From a fundamental perspective, some (e.g. analysts on Reuters) see a deficit for the current year, others forecast a copper surplus (International Copper Study Group).
If China's GDP growth declines significantly, stimulus measures from the government are likely to be needed to give the economy a new boost. And lower Chinese copper demand will probably be compensated again in the course of the year, when the health crisis is over. The development in the coming months will be decisive, as China and the copper price are closely linked.
Even if it still takes weeks before normality is restored, an investment in copper companies is always a matter worth considering. One might think of Copper Mountain Mining or Aurania Resources.
Copper Mountain Mining has a 75 percent interest in the Copper Mountain Mine in British Columbia (87.2 million pounds of copper equivalent in 2019 in total): https://www.commodity-tv.com/play/newsflash-with-skeena-resources-caledonia-mining-copper-mountain-and-millennial-lithium/. In addition, there is the approved Eva copper project in Australia (measured and indicated resources of 2.1 billion pounds of copper).
Aurania Resources is exploring for precious metals and copper at its The Lost Cities Cutucu project: https://www.commodity-tv.com/play/aurania-resources-following-track-of-possible-road-lidar-program-started/. A private placement for eight million Canadian dollars will be used for further exploration.
Recent corporate news and press releases from Copper Mountain Mining (https://www.resource-capital.ch/en/companies/copper-mountain-mining-corp/) and Aurania Resources (https://www.resource-capital.ch/en/companies/aurania-resources-ltd/).
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