INSIGHTS FROM THE GROUND
Are We Witnessing the Beginning of a New Commodity Supercycle?
“The price of copper responds to the laws of supply and demand. A supercycle involves a long boom in demand that drives up prices until they get so high that demand collapses, pulling prices down again. Currently, we are not seeing a difference between supply and demand of copper big enough to constitute a supercycle.”
Marco Riveros, Vice President, Cochilco
“We are witnessing the reflationary efforts of central banks around the world who are injecting stimulus into the world economies at an unprecedented level. This will trigger inflation and a boom in commodity prices.”
Michael Kosowan, President and CEO, Torq Resources
“We are seeing an upward cycle for commodity prices, which was expected to follow the downward trend that began in 2012. The pandemic ignited and exacerbated the upward cycle by triggering one of the most extensive expansionary monetary and fiscal plans in history.”
Juan Carlos Guajardo, Founder and Executive Director, Plus Mining
“If you look at supply and demand, the market seems to be tight. Global inventories are as low as they have been in at least a decade. From a fundamental perspective, the market continues to be strong, the challenges are around the uncertainties associated with a global recovery and China.”
Joshua Olmsted, President and Chief Operating Officer-Americas, Freeport-McMoRan
“Following 2020 and the impact of the pandemic, we now have a tight market and expectations are that there will be major stimulus to the global economy. We believe that copper demand growth will continue as the world seeks to find cleaner solutions for modern life.”
Iván Arriagada, CEO, Antofagasta Minerals
“A supercycle is defined as one resulting from a major structural shift in the market. There is uncertainty to the speed at which the transition will happen to EVs and renewable energy which will determine the nature of this structural shift and the extent to which this is a commodity supercycle.”
John Currie, Director, Excava
