Copper (Cu)

Copper is a ductile metal with a very high thermal and electrical conductivity. It is used extensively in plumbing, refrigeration and air conditioning equipment as well as in various electrical devices and circuit boards. Alloying of copper with zinc makes brass. Similarly, bronze is a copper-tin alloy. Most copper ore is mined as sulphides from large open pit mines in porphyry copper deposits.

Being one of the most widely used metals, the world price for copper changes constantly as the market attempts to balance supply and demand at any given time. Future demand for copper is expected to grow strongly as China, India and many other developing countries industralise and urbanise. Per capita demand for copper rises as GDP per capita rises. Currently Japan consumes around 12kg per capita, North America consumes around 10kg per capital and Europe around 9kg per capita. The large populations of China, India, Eastern Europe and South America are all consuming less than 2kg per capita – giving an indication of what lies ahead for copper demand. Copper supply is made up of 88 per cent primary production supplemented by 12 per cent secondary supply, i.e recycled copper scrap. Most of today’s technology requires pure copper, or copper of 99.95 per cent purity.

 

Gold (Au)

Gold is a precious metal used mainly in jewellery, plating, electronics and in chemical applications. Gold is commonly viewed as a currency rather than a commodity and it forms a large part of many countries’ national reserves.

Historically gold has been seen as a safe haven in times of rising inflation, low interest rates, finanical uncertainty, monetary disruptions and cival unrest. Since the year 2000 gold prices have increased very significantly. This has been largely driven by the record high oil prices, declines in the US dollar versus the Euro and concerns regarding the American economy. On the production side, South African mines have been forced to cut production as a result of country-wide power rationing.