SANTIAGO – On the last business day of 2017, copper stopped its impressive bull run, which lasted for 13 consecutive days. However, despite the 0.82% drop on Friday on the London Metal Exchange, the red metal closed 2017 with an annual increase that was not seen since 2010. On Friday the red metal was traded at US$ 3.246 per pound, US$3.273 on Thursday, and US$3.239 on Wednesday.
Thus, Chile’s main export recorded a weekly increase of 1.96% in its value per pound, while the monthly increased by 5.85%. With respect to December 30, 2016, where it was quoted at US$2.49521, copper registered an advance of US$0.75115, which means that it increased its value per pound by 30.10% in the year. The increase in its price was not seen since 2010, according to data from Bci Estudios, where it registered an annual increase of 30.56%.
For its part, in the year, the minimum price of the commodity was registered on May 8, when the red metal was quoted at US$2.47934, while the highest was US$3.27312, which was seen on December 28.
“The year 2017 was reactivated in global economic terms,” said Bci Estudios economist Antonio Moncado. Thus, one of the main factors that boosted the price of the red metal, beyond expectations, was “the phenomenon associated with a higher expectation of an upturn in construction or infrastructure driven by the Donald Trump government program,” said Moncado . The foregoing, according to the economist, led many investors to take positions in the commodities derivatives market and particularly in the price of copper that ended up stimulating and raising the price of the metal.
In addition to the Trump factor, “a very positive influence was evidenced from China, which showed a very favorable economic performance in 2017 and that gravitated to a greater expectation of future copper imports,” explained the Bci expert. As a third factor that influenced the increase in the valuation per pound of the metal, it was the fact that there were supply contractions as a result of production stoppages in mining deposits, as was the case of Minera Escondida and other Asians.
For the next year, Moncado predicts that it will be a year where the price of copper could show an upward trend but “undoubtedly lower than what we saw this year”. In that sense, “we will see permanence in a relatively high copper price, but we will not see an increase in magnitude as it was 2017”.–MercoPress
