The price of copper is not constant, and it may fluctuate for a number of different reasons, but one of the main reasons is called supply and demand. Supply is the number of copper available for people to buy smart money tq answer and Demand means how much people want to buy. Generally, this price declines during times that excess copper is present in the market. This is due to the fact there are countless numbers of this out there, which means that not many people want to purchase it. Think of it this way: If a store has too much toy stock then the item may be priced down so there can be more sales.
However, when the number of copper bowls are not enough for everyone competing to hold one, prices begin to rise. So what this means is that if a lot of people require copper and too many people compete for it, the price will go up. This is comparable to a hot product, say a special kind of toy that everyone wants but only few are available; price is going up here because among those wanting it, some are willing to pay more in order to possess the same!
Fourth, the economy is another big reason that could move copper. An economy is simply how good or bad money is being spent in a country. A downturn, for example when people were fearful about losing their jobs, does not want to spend a lot of money. This means that businesses may not use as much copper since they are producing fewer products. This would have the effect of pushing copper prices lower as there is less need for it. But right now when people have more spare cash to splash out, businesses may wish to upgrade the buildings and equipment they work from. That means futures demand more copper and the price can mover higher.
The copper price has moved up and down over the years, numerous times. In the 1980s copper prices went through the roof. The main reason for this was the high demand for copper, especially from China with its fast industrial-fieldization needing relatively massive amounts of copper as orientative, each new mile i.e. new line ofproduction/building needed a lot of it. Nevertheless, prices plateaued and actually fell a bit in the 1990s and early aughts. This was a time when less copper was needed and not many people were buying it.
Nobody can really predict what copper is going to be pricated at in the future. There is a plethora of variables that can alter the price. Things like supply of copper, demand for copper and the strength of the economy will have a huge impact A better economy means increased demand for copper from business expansion efforts. This can increase demand and push prices higher. Alternatively, if some new technologies come in that require less copper or people start to use alternative materials, the demand for copper would decline. That would suggest lower prices.
On the other hand, when copper prices decrease companies can reduce their prices but still earn profits. This is cool for consumers, they end up buying stuff at cheaper prices. The stock market can also be affected by copper prices. For example, if copper prices were to rise, stocks of companies that use a lot of copper (such as electronics manufacturers) may fall. That is because these companies could face higher costs due to increased copper prices, which can be detrimental for their profits.
There are a number of approaches that can be taken to mitigate the impact of copper price changes if you operate a business that demands high usage. One of the best ways to do it is to lock in pricing with contracts through suppliers. When you sign contracts, they lock in a coil of steel and protect you from potentially rapid escalations in price should copper become scarce. A second tactic is seeking lower-cost materials — for instance, aluminum or plastic. That would allow businesses to still manufacture their products, without over-dependence on copper.
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