After several poor years, copper futures have bounced sharply. They rose by a fifth this summer to a three-year high close to $7,000 a tonne. Growth in China, which takes almost half the world’s copper, looks solid, while India’s appetite for the red metal is growing by around 8% a year.
But the latest surge stems from the rapid spread of electric cars, which BHP Billiton notes use four times as much copper as conventional ones. Meanwhile, a dearth of significant discoveries in recent years points to tighter supply. The market will be in deficit in 2017 for the first time in years, says Citi Research.