Copper Insights: Q4 2012 

Key insights

• Copper demand is expected to increase 3.6 percent in 2013 and 4.3 percent in 2014.
• Those expansion projects that are burdened with these additional labor, contractor and infrastructure issues will feel further pain as with the overall supply growth, pricing is expected to face downward pressure.
• During Q4 2012, average copper prices increased 2 percent q-o-q to US$3.56/lb from its Q3 2012 average of US$3.50/lb underpinned by the support offered by positive indicators from the central banks in the US, Europe and Japan.
• Announcements from China that it intends to accelerate infrastructure projects worth US$157 billion in 2012 along with ongoing monetary easing is expected to help drive improvements in its copper demand.
• The US market is expected to grow modestly in 2013 driven by demand from the country's automotive sector and ongoing recovery in the domestic housing market.
• The Middle East is emerging as an increasingly important region for growth driven largely by the infrastructure development in the region. Demand from the EU is expected to remain subdued in 2013, but is expected to grow modestly in the longer run by 2014.