Apr
25
2012
The commodity metal copper is known in the financial world as “Dr. Copper,” because, historically, the copper spot price has predicted the health of the global economy, as it is an important input resource to a huge number of industrial processes.
With all of the bad news coming out in the last few weeks, after a seemingly upbeat start to the year, and the Fed’s take on the economy out today, it seems a good time to check in on our trusty time-tested bellwether.
It is an opportune to discuss the metal as Cesco Week, the leading series of events in the world copper industry, just wrapped up in Santiago, Chile. According to the FT:
“The consensus at Cesco week, from within the mining industry and beyond, was that much of the supply would not arrive on time.”
Supply problems facing the industry are many. Eric King interviews many heads of mining firms, and has identified a pattern; a dire shortage of mine engineers and contractors. The CEO’s tell him that mining professionals are in demand and are being paid far more than in the past and in many cases, must be flown to locations. Costs of labor of all types are rising rapidly, and strikes are becoming more and more common. (more)
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