Japan's Pan Pacific Copper expects copper prices to hover around US$7,000/ton in 2021

Pan Pacific Copper (PPC), Japan's number one copper supplier, predicts that copper prices will hover between US$6,500 and US$7,000 per ton in 2021, which is lower than the current US$7,850. Because demand recovery is limited, the market will experience oversupply.

PPC is a joint venture between JX Japan Mining & Metals Corporation and Mitsui Mining & Smelting Corporation. Naoki Kojima, the company's general manager in charge of marketing, said that in 2021, global refined copper consumption and supply will increase by 3.3% and 2.6% respectively over this year.

Next year, the global refined copper market will have a surplus of 121,000 tons, and this year's surplus will be 291,000 tons.

Kojima said that demand in 2021 will exceed this year's level because governments are taking stimulus measures to boost the economy. But it will not return to the level of 2019, because the pandemic will continue to put pressure on demand in the first half of the year.

Since hitting an intra-year low of US$4,371/ton in March, copper prices have risen to US$7973.5 per ton, the highest level since February 2013.

PPC believes that the current copper price does not reflect the fundamentals and the rebound has been overdone. Kojima said that the reasonable trading range for copper prices next year will be between US$6,500 and US$7,000 per ton.