John Gross, publisher of The Copper Journal, has been working in the metals industry since the 1970s, and he has spent most of that time tracking metals pricing patterns. He is particularly adept at forecasting copper, an art and craft he learned as a broker on both the New York and London Commodity Exchanges and as manager of metal procurement for Cablec. In his latest note to Copper Journal subscribers, Gross says copper has a ways to run in its current surge.
"Over the past fifty some odd years, each time the price fell to a new low on an annual average basis, it subsequently rose to a new higher high," says Gross. "Sometimes it took two years to make the new high, other times three, or five years. The last high point was $4.01 set in 2011, and the market fell sharply over the following five years to average $2.20 in 2016. That represents a $1.81, or 45% loss over the period, which also brought the market to an 11-year low.
"Since then, we’ve seen copper rebound, with the price averaging $2.80 last year, and pushing it a just a bit more than 1¢ over the threshold of the five-year moving average. Last month copper averaged $3.0640 on Comex, off 2.36¢ from April, but it was it was up 52¢, or 20% over $2.55 last May. Through the first five months of 2018, the average stands at $3.12, up 50¢, or 19% over $2.62 through May of last year.
"While we wouldn’t venture a guess as to what fundamental factors will move copper to the $5 level, or how long it will take to hit that major milestone, history tells us it is just a matter of time before we get there. How will you prepare for this event to take place?"