Chile Commodities September 2017

Chile

Chile: Copper prices rise again in September

October 3, 2017

Copper prices rose for the fourth consecutive month in September, reaching their highest level in well over two years. Copper prices averaged USD 2.98 per pound (equivalent to USD 6,577 per ton) in September, up 1.3% from August’s average price of USD 2.95 per pound. In annual terms, copper prices increased 39.3% in September.

Despite pulling back more recently from the peak reached in early September, prices still rose on average last month, with investors bullish on the back of solid demand from China. In addition, speculative buying has undoubtedly had a part to play in the frothy market, with investors excited about the potential for greater electric car use to boost copper demand; copper is present in much greater quantities in electric vehicles than in those with traditional combustion engines.

After such a strong Q3, there are doubts over whether copper prices can be maintained at their current level, especially if recent efforts to tighten credit growth in China dampen economic activity. Indeed, prices have already begun to dip from the multi-year high reached in September. Panelists participating in the LatinFocus Consensus Forecast expect copper prices to average USD 2.72 per pound in 2017 and USD 2.83 per pound in 2018.


Author:, Economist

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Chile Commodities October 2017

Note: Cash seller and settlement price.
Source: London Metal Exchange (LME).


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