Mining Brief
Copper Mine Production Increasing While Gold Prices Rise
- FinancialNewsMedia.com News Commentary
PALM BEACH, Fla., Sept. 22, 2020 /PRNewswire/ -- Copper and gold are both very 'hot' commodities during this… or actually in spite of… the growing global pandemic. The prices in both are projected to continue to grow but there are differences. Copper demand is growing which should increase mining operations… while increasing gold mining is not the driver of the increasing demand but gold's rise will primarily be driven by the global uncertainty fueled by the COVID-19 pandemic. Global copper mine production will see steady growth over the next few years, as a number of new projects and expansions come online, supported by rising copper prices and demand, Fitch Solutions forecasts in a new report. The Fitch analysts in Mining.com predict: "global copper mine production to increase by an average annual rate of 3.1% over 2020-2029, with total output rising from 20.3 to 26.8 million tonnes over the same period." Fitch found that the US copper miners are better positioned financially than operators in other markets, having worked to cut operating costs and increase profitability over recent years. In the longer term, Fitch believes copper outlook in the country will recover, driven by a rise in copper prices and continued foreign investment which will be lured by the country's high-grade reserves. Active stocks in the mining markets this week include QMC Quantum Minerals Corp., (TSX-V: QMC) (OTCPK: QMCQF), Equinox Gold Corp. (NYSE: EQX) (TSX: EQX), Eclipse Gold Mining Corporation (OTCPK: EGLPF) (TSX-V: EGLD), B2Gold Corp. (NYSE: BTG) (TSX: BTO), IAMGOLD Corporation (NYSE: IAG) (TSX: IMG).
But copper prices are also increasing. A recent analysis this past July from Zacks Investment Research posted to Yahoo.com, indicated the price of copper rose by 11 percent in June, and the "uptrend can be attributed to optimism over financial stimulus and strong demand in China, which is the top consumer, amid growing fears of disruption in copper output in Chile." Another by Reuters columnist Andy Home wrote July 14 that "hedge funds are starting to buy into the rally in copper," and that London Metal Exchange (LME) copper hit a two-year high of $6,633 per metric ton Monday, July 13. Home added, "At a current $6,490, it is now up 5 percent on levels at the start of the year, having clawed back all its COVID-19 losses." Turning to gold, a recent article in Fox Business said that gold could each and maybe stay above the $2,200/oz threshold. It said: "Gold prices are set to spring higher after more than a month of moving sideways, according to one analyst. Drivers include a positive technical backdrop and the likelihood of sustained low interest rates in the world's largest economies that may prompt investors to seek better returns in other "safe haven" investments. Gold has "worked off the momentum, sentiment and positioning extremes seen at the peak and looks set to resume its uptrend" wrote Laurence Balanco of Hong Kong-based capital markets and investment group CLSA Ltd…. "We would look at adding new long gold positions," Balanco said.