Why I’ve Sold Most of My Copper Stocks even as China Scrambles

Detailed summary

China's copper buyers are scrambling. The Yangshan import premium just hit a record $230 a tonne, Shanghai spot premiums tripled in two weeks, and exchange stocks tumbled 24% to cover less than a day of the country's consumption. Yet the price is sitting around $14,000 a tonne, roughly 7% below September's record, after three failed runs at $15,000.

In other words, the price moves first. And then everyone and their dog tells you their pet theory about why.

Interesting analysis usually… but not much use to you as an investor after the fact.

And practically speaking, that means reading price action: looking at charts to see which trends are developing, and which are breaking down.

The best opportunities tend to sit where price action and the prevailing narrative disagree.

I first got interested in copper back in late 2022 when prices were falling sharply. Nobody else was. Finding value was relatively easy then…much easier than it is today.

So I recommended a bunch of copper stocks to my paid readership, and most have done very well since.

The narrative has since been propelled forward by the AI data-centre build-out, the electrification of transport, and heavy spending on power grids.

All three are copper-intensive. Meanwhile, mine supply growth has been sluggish for years, and ore grades at established mines keep falling.

The Yangshan premium (the fee paid to import copper into China’s key port) hit a record $230 a tonne on Monday.

Opening of the article, excerpted from Fat Tail Daily. To read the rest, open the article on the publisher's site.