TELEPHONE 01543 226816

COVID-19 pandemic- “The good, the bad and the ugly for Copper”

Copper manufacturer for electric pylons

Week commencing: 9/08/2021       Issue: 16

The last eighteen months have been hard for everyone and the global commodity market has not been immune from the ravages of the COVID 19 pandemic. The impact of the pandemic has been felt everywhere from supply problems to finance issues and it is potentially set to get worse with what’s happening in Chile, covered in my previous article and subsequent update. Numerous industries have seen a spike for the requirement of Copper including the medical, electrical, data storage and clean energy sectors and other businesses have experienced lead time delays and supply issues due to the restrictions the pandemic placed on everyday normal life.

A good example of how the pandemic put a spotlight on Copper is how the medical industry hails it as an antimicrobial safeguard using its properties to halt the spread of the disease on touch surfaces.  Scientists have reported that the antimicrobial properties of Copper eliminates up to 99.9% of certain bacteria within two hours of exposure and alongside regular cleaning should minimise the risk of spreading infection in public areas. The demand has increased as Copper is becoming more frequently used for high touch surface areas and throughout healthcare institutes such as hospitals to minimise the spread of infection through door handles, touch plates and kick plates on doors.

Throughout the pandemic many businesses worldwide were forced to result to working from home, increasing the demand for the electrical and power industries. The increased use of online date portals forced many companies to “up their game” when it came to data storage and transmission. Data centres have more easily enabled digital commerce and online meetings, making digital infrastructure more important than ever, allowing businesses to keep operating and growing through a digital platform. This provided a high demand for switchgear to assist in powering data centres in an effective and safe manner, in which Copper is a key component, increasing the demand for the commodity in a major way.

The COVID-19 pandemic has focused minds even more on the global issue of climate change and has highlighted to everyone that a cleaner, healthier world is one worth striving for and one in which Copper plays a vital role. Reports claim that viruses, such as COVID-19 can be caused by the lack of regard that energy systems have for the health and wellbeing of the population and environment, encouraging illnesses. Copper has a significant role in renewable energy and sources suggest that its demand is set to increase as the world moves away from fossil fuels which are damaging the planet, towards clean energy technologies. As of 2020, thousands of cities set renewable energy targets, as more countries plan to protect their environment against pollution. Copper is an essential material which plays a critical role in building both the technologies as well as the infrastructure that enables us to support the power industry such as solar and wind technologies.

The restrictions within the pandemic also created travel issues and prevented regular international travel from taking place. This created huge uncertainty in the shipping and receiving of goods overseas. In April 2021, Chile, the world’s leading Copper producing country, made the decision to close its borders due to the increased number of COVID cases, preventing foreign residents and Chilean citizens from entering or leaving the country, having a large impact on the Copper supply, lead times and prices. During this period tough restrictions disrupted mining activities by delaying equipment replacements. With more staff forced to work from home, businesses putting staff onto the furlough scheme and people with medical conditions shielding at home it created a struggle with communication and a manufacturing backlog as the demand to supply ratio was unbalanced. All these factors began to influence the Copper price, experiencing decade highs in April 2021, hitting $10,000 per tonne.

As the world begins to recover from the pandemic, some countries quicker than others, we continue to see the impact of the aftermath from issues that rose throughout. Some companies continue to struggle to finance high metal prices whereas some struggle to get hold of raw materials. In addition, strikes and pay disputes have begun at main Copper producing mines, as unions demand staff wages reflect their expectations and workload such as the current battle at the BHP’s Group’s Escondida mine.

How can ILF help you?

ILF continue to provide customers with the best available supply of Copper, meeting customers’ needs and retaining high inventory levels. ILF are excited for what the future of the Copper industry holds and supporting customers with their new demand.

Have you had an increase of Copper demand? If you have been impacted, we would love to hear from you and find a solution to your challenges.

ILF Milly Edwards

Sales and Marketing Executive: Responsible for creating content for ILF's social media channels, website, print media and promotional work.

Table of Contents