- `I don’t see the reason why the copper price should be lower'
- U.S. and Europe each seen growing 1.5% or more in 2016
Aurubis AG is giving hope for the copper market after three years of price declines.
Europe’s top copper smelter said it’s “cautiously optimistic” about demand there and in the U.S. in the second half of the year amid production cutbacks. Prices of the metal in London rose 3 percent last quarter, helped by output cuts at companies including Glencore Plc.
Copper fell for three straight years through 2015 as China, the world’s biggest user, posted its slowest economic growth in a generation. Some signs of stabilization in the U.S. and Europe are helping buoy demand prospects. Euro-area unemployment retreated in February to the lowest since 2011, and economic confidence rebounded last month. Reports last week showed resilient U.S. hiring and manufacturing.
“I don’t see the reason why the copper price should be lower,” Stefan Boel, a member of Aurubis’s management board, said in interview in Santiago. “I am cautiously optimistic. I see a balanced market. There is much less production coming in. Consumption could be better but production is even worse.”
China grew 6.9 percent in 2015, the slowest in a quarter century, and will slip to 6.5 percent this year, based on the median of 59 estimates in a Bloomberg survey of economists. Boel said he “didn’t know what to think” about the outlook for copper demand in China.
Analysts surveyed by Bloomberg forecast 2016 growth in the U.S. at 2.1 percent, and at 1.5 percent in the euro area.