Copper, experiencing a surge in demand due to its various applications in the transition to renewable energy, from electric vehicles to solar panels and wind turbines, has seen its prices soar to over $10,000 per ton on Friday, reaching the highest level in the past two years.
The spike in copper prices came as a result of increasing global demand and tightening supply. Delving into specifics, the fundamental metal grabbed headlines following mining giant BHP's initiation of a $38.8 billion takeover bid for its British rival Anglo American on Thursday. This bold move aims to create the world's largest publicly traded copper producer.
However, on Friday, Anglo American deemed the offer as "unattractive" and "opportunistic," rejecting it with a non-commendable evaluation.
This surge in copper has brought attention to companies operating in this sector. In a note dated April 7, JPMorgan identified the U.S.-listed Teck Resources as its top choice for copper investment.
However, most investors consulting with the bank prefer Freeport-McMoRan, an American mining company, for copper investment.
JPMorgan, in making this comparison, stated, "Amid ongoing labor challenges, we are particularly focused on progress in leach operations at its legacy assets in North America and cost improvements." Nonetheless, the bank highlights that Teck still remains cheaper than Freeport.
As the demand for copper continues to rise alongside the ongoing global transition to renewable energy sources, the dynamics of the market are poised for further shifts, with investors closely monitoring developments in the sector.
