I wish I had a bitcoin for every research report that has crossed my desk in the last three years about the looming copper-supply crisis. I’d be richer than Satoshi Nakamoto, the person thought to have developed bitcoin. Well, maybe not quite. But you get my point. Nevertheless, there is a chance that the narrative is now becoming reality. Bank of America (BoA) has just released a research report entitled The copper supply crisis is here. Meanwhile, the copper price is close to all-time highs and looks ready to break through them. In today’s piece I shall look at copper’s long-term price action, give you a quick overview of the market, examine the supply and demand situation and consider various ways to play the red metal.
A price cap since 2008
The $4.20-$4.60 per pound (lb) area has been a key resistance level on the chart of the copper price since 2008. Prices broke above them in the early 2020s and after a nasty correction are retesting those levels now.
I see parallels with the $1.45-$1.50 level, which proved a barrier for 25 years, from 1980 to 2005. Once copper broke through, it
