Here are just a few reasons why you should invest in copper:
- China's State Reserve Bureau is purchasing mass quantities of copper to build reserves and could purchase another 900,000 tons of copper this year.
- Copper demand may pick up during China's peak construction season.
- Copper prices have been hammered in the past year and they seem to have hit bottom. Technically copper looks like it can take off.
- Coordinated government support measures may revive global economic growth, which will boost copper demand.
- Falling scrap supplies is leading to lower copper inventories.
- It looks like there is a decline in copper short positions. We could see a strong rally if speculators quickly cover their shorts.
Obviously, the continued industrialization of India and China will lead to greater demand for copper. In addition, I expect copper production to increase less rapidly than demand as output at producing mines is declining, and a smaller amount of new mines are coming into production due to high start up costs.
Copper is used in every industry and is absolutely necessary to sustain our society.