Constraints on copper supplies

Analysts with Macquarie Research make the case that copper supply shortages will lead to higher prices.

"Since 2004, only around 1.45 million tons [per year] of new supply have been brought online."

A decade ago, predictions were for addition of more than 7 million tons of produce but only about 20% of that has actually under construction or operational according to the study.

In a financial presentation at the end of June, Freeport McMoRan Copper & Gold shared the figure at bottom right, showing that while stocks of copper have risen in the past two years, they are still well below historical amounts. Freeport projects production of 1.2 billion pounds of copper in 2011 from its U.S. operations, primarily in Arizona.