Investor interest in the commodities market is undergoing a noticeable transformation, with copper emerging as the preferred investment for 2024, overshadowing battery metals, while gold and silver maintain steady appeal.
According to an article by Neils Christensen published by Kitco News on February 29, this shift in focus was highlighted at the 33rd annual Global Metals, Mining & Critical Minerals Conference hosted by BMO Capital Markets, a leading financial services provider.
The conference, which took place from 25 to 28 February 2024 in Hollywood, Florida, has been recognized as a premier event in the metals and mining sector. It attracted nearly 1,500 industry leaders from almost 650 organizations across six continents, including key players from the automotive and critical mineral production sectors.
A survey conducted among the attendees revealed a strong inclination towards copper, with 62% expressing a preference to hold the metal over the next five years, a slight dip from the previous year’s sentiment. Gold secured the second spot, with 22% of participants identifying it as their long-term asset of choice, marking a significant increase from the 10% recorded last year. Meanwhile, lithium and iron maintained their positions, with 13% favoring lithium and a modest 2% leaning towards iron.
Despite the sustained interest in critical and battery metals from the previous year, the 2024 conference saw a reduction in investor enthusiasm for these sectors. This change in investor sentiment possibly reflects an anticipation of a price floor for underperforming battery materials, although a consensus on reaching this threshold has not yet been established.
Gold’s investment allure remains robust, albeit with a neutral stance on its pricing. Half of the conference participants anticipate gold prices to oscillate between $1,950 and $2,150 an ounce, while a bullish 32% predict a price range of $2,150 to $2,350 an ounce. A noteworthy 11% of attendees foresee gold prices surpassing the $2,350 mark by the end of the year.
The conference also shed light on evolving perspectives regarding the gold market’s driving forces. A considerable focus on the U.S. dollar and interest rates was observed, alongside a minimal emphasis on central bank demand. BMO analysts challenged this outlook, suggesting a diminished correlation between gold and real rates, and highlighted the undervalued role of Chinese consumer demand and emerging market central bank purchases as pivotal for gold’s future.
BMO Capital Markets, a subsidiary of BMO Financial Group, is recognized as a top-tier provider of a wide range of financial services, including corporate and investment banking, treasury management, and advisory services. As part of BMO Financial Group, one of North America’s largest and most diversified financial service entities, it boasts assets totaling US$861 billion and employs around 47,000 staff as of 31 January 2023.
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