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Following the volatility that the copper market and commodities as a whole have experienced over the last six months, it has become increasingly difficult to accurately gauge short- and long-term demand.
The first half of this year looked very weak for Chinese demand; however in the last couple of months it has picked up again. The US markets have shown steady growth, although at a very slow pace, and finally the eurozone is (technically) out of a recession, but neither region has been able to convincingly pick up the slack from the reduced demand in Asia.
The grey cloud that has obviously been hanging over the markets has been an anticipated end to the US quantitative easing (QE) policy and the reduction in demand that this would cause. The QE issue has been well addressed and to some greater extent factored in, but the collapse of many of the developing world’s currencies has not. Developing nations make up a sizable percentage of the global demand. The Indian rupee has set numerous lows over the course of the last month and continues to look weak.
Antofagasta, like almost all of the major mining companies, has done much to reduce costs and improve profitability; ultimately though it is demand that will drive the share price higher or lower and this is out of their hands.