It is becoming commonplace to talk of a new commodities super cycle.
The last cycle peaked in 2008 after 12 years of expansion, fuelled by the rise of China and growing demand for raw materials. It seems increasingly likely that a new cycle began in mid-2020 after a 12-year contraction.
A confluence of factors, including economic recovery, policy stimulus and rising inflation expectations that bring purchases forward before they become too expensive, have been behind the recent rise in the copper price, which is a key driver of the performance of the metals and mining sector. The development of the ‘green’ infrastructure theme is also pushing metal prices higher, as supply is squeezed from lower capital investment and demand for low carbon emission technology (e.g. electric vehicles).
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