Lundin Mining Corp T.LUN

RBC

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Looming copper shortage will benefit these stocks: RBC analyst

RBC Dominion Securities analyst Sam Crittenden detailed a looming shortfall in copper supply that should keep the commodity price higher,

“There is a looming supply crunch coming in the copper market: You have probably heard by now that the energy transition will require a lot of copper. An additional 1 per cent per year on our estimates which doesn’t sound like much but would be the equivalent of one large scale copper mine coming online every year. We can debate demand projections, but it’s always been a supply story with an aging supply base, declining grades and quality projects becoming more scarce and harder to build for ESG reasons … We think this potential supply deficit is filled partially by increased scrap and substitution/thrifting of copper but largely through a supply response from the copper mining industry which likely requires a period of high copper prices. We forecast copper prices of $4.50/lb from 2025-2027 for this reason which could be conservative if supply struggles to respond … Quality shovel ready projects are scarce and getting more difficult to build: When we look at the list of available copper projects it’s notable that there is a lot of copper out there but a lot of it may never come out of the ground”

Mr. Crittenden lists First Quantum Ltd. [disclosure: I personally own a position in FM], Ivanhoe Mines Ltd., Hudbay Minerals Inc. and Lundin Mining Corp. among the miners that will benefit from the trend.