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23 December 2021

Farewell, unloved 2021


It would be difficult to make the case for 2021 having been  a ‘good’ year. Maybe the grape harvest will prove to have been a good one, and we will have a top vintage; but having looked at the weather around Europe through the year, I’m frankly not holding my breath for that one, either. No, I think 2021 deserves to join 2020 in the dustbin of history, and to be forgotten as quickly as possible.

Although having said that, the performance of the metals (and other solid assets) through the year has been impressive; demand growth and supply uncertainties have driven that. Will it continue? My instinct is yes, with copper still my favoured metal, with the same drivers as we have seen. 

There is also one other, new potential supply side issue for copper, with the election of a hard-left President in Chile. Since the end of the Pinochet regime, Chile has looked a beacon of economic sanity in Latin America, and for a longer period than that it has demonstrated that a state-owned mining sector can be both efficient and effective. It’s almost unique in that. Unfortunately, history tells us that left wing administrations have a poor record of sustaining such success; I hope I’m wrong, but I fear supply issues could raise their head here, which would of course bolster the price development. 


But it’s Christmas, and no time for politics. This is the last from me this year, so I would just like to wish all readers a Merry Christmas and a Happy New Year - with the added prayer that it’s a better one than the last two.  











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