Copper: A Window into the Future Economy

When it comes to reading the pulse of the global economy, few indicators are as reliable as copper.

Often referred to as "Dr. Copper," the metal has historically acted as an economic barometer.

When demand for copper slows, it’s usually a red flag that the global economy is cooling off.

But today, the copper story is less about immediate demand and more about a looming supply crisis.

I believe this story will shape market moves for the next decade.

The chart above, pulled from S&P Global Market Intelligence, tells the tale of copper discoveries from 1990 to 2023.

It's clear: we’re underinvested in the exploration and production of copper.

The blue line, representing the copper exploration budget, saw a spike in the 2010s but is still dwarfed by the global demand forecasts, particularly driven by the AI revolution, renewable energy, and infrastructure needs, which I talk about here:

Copper is the backbone of some of the most transformative technological shifts underway today.

It’s critical for the expansion of data centers powering AI, the ongoing transition to renewable energy (think solar panels, wind turbines, electric vehicles), and let’s not forget the geopolitical factor—wars consume resources, and copper is at the heart of military equipment.

Yet, despite copper's indispensable role, we’ve been sleepwalking into a supply crunch.

According to the chart, major copper discoveries have significantly dwindled since the early 2000s.

Recent years show near-zero new discoveries, while the world’s appetite for copper continues to rise.

Here’s the issue: copper exploration is a long game, one that takes 10 to 20 years to turn a discovery into active production.

Simply put, even with a surge in exploration budgets, new supply won’t hit the market fast enough to meet demand. This imbalance will almost certainly lead to higher prices and volatility in the copper markets.

What typically happens in such a scenario?

A price bubble!

Just like we’ve seen in past cycles, copper is on the verge of a massive run-up. Prices will fly as investors and companies rush to capture the upside, leading to a surge in underlying copper-related equities.

And once the world wakes up to the supply/demand mismatch, we’re going to see a flood of capital into copper mining projects. Particularly, those publicly listed.

This will be a multi-year trend.

Governments are also part of the equation.

When economies slow down, their first move is to spend, spend, spend their way out of a recession.

Infrastructure projects, which require vast amounts of copper, are often at the top of the list.

As we navigate this early stage of economic uncertainty, keep an eye on government spending patterns and stimulus packages. The more infrastructure talk you hear, the more copper demand will soar.

The blue line in the chart above holds the key to your investment strategy.

It represents the exploration budget, which is only just beginning to recover after a decade-long dip. As demand for copper outstrips supply, the companies focused on exploration and production will be in the driver’s seat.

The smart money is already positioning itself for this inevitable upside.

If you’re wondering how to capture the gains, I’ll be sharing more about my strategy in the coming weeks and months, however, I have discussed 4 of my top copper picks previously which can also be found in the Copper to $40,000 article above.

For now, let’s just say that staying ahead of this copper shortage will be like owning real estate in the path of progress. And those who position themselves early will be the ones to reap the biggest rewards.

Copper might be off the radar for most investors today, but mark my words—it won’t stay that way for long. Get ready for a copper boom, and make sure you're positioned to capture this once-in-a-decade opportunity.

I certainly am.

Through my company, Bromac Resources, we’re zeroing in on a promising copper project in Zambia—a region well-known for its rich copper deposits and mining-friendly environment.

We’ve recently signed a Letter of Intent, and are advancing quickly toward taking the company public in Canada.

Our goal is to accelerate exploration efforts and tap into Zambia’s vast copper potential at a time when global demand is set to explode.

This move aligns with our broader strategy of positioning ourselves at the forefront of the copper supply chain.

As the market shifts and demand intensifies, companies like Bromac will be essential in bridging the growing supply gap.

Stay tuned for more, and as always, happy hunting!