BHP (ASX:BHP) share price on watch as copper demand tipped to soar

The BHP (ASX:BHP) share price is on watch today amid reports miners are revising their forecasts due to soaring demand for copper and nickel.

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BHP Group Ltd (ASX: BHP) shares will be on watch today amid reports the company has revised its internal forecasts due to soaring demand for copper and nickel. At Monday's close, the BHP share price was trading at $46.18 after losing 0.79% yesterday.

The Sydney Morning Herald (SMH) reports today that BHP expects demand for copper to double and nickel to quadruple over the next 30 years due to the proliferation of the metals in renewable energy technologies.

BHP's head of mining operations in the Americas, Ragnar Udd, said electric vehicles will be the key driver.

Quoted by SMH, Mr Udd told the World Copper Conference in Chile, "These vehicles use four times as much copper as petrol-based cars, and they will also need more infrastructure to connect charging stations to the grid." 

"This example highlights the essential role resources will play in the transition to renewable energies."

Strong copper prices creating gains

The copper price is currently near its all-time-highs at US$4.04 per pound, just short of its historical high of US$4.48 set in February 2011. The copper price has now almost doubled since April 2020. 

Renewable power systems are five times more copper-intensive than conventional systems, leading to increased investor interest in ASX copper miners.

Canadian copper miner Kincora Copper CDI (ASX: KCC), partly owned by RareX Ltd (ASX: REE), recently had a highly over-subscribed initial public offering (IPO) on the ASX, in which it upwardly revised its original raising target.

BHP and Rio Tinto Limited (ASX: RIO) jointly operate the world's largest copper mine in Chile, and BHP has said it's currently in the process of increasing its exposure to the material.

It's also in the process of selling several coal mines, leaving the production of thermal coal, and exiting the Bass Strait oil and gas fields. 

BHP share price snapshot

The BHP share price lost ground yesterday and has also fallen by 3.55% over the past month. Over the past year, the same period during which the copper price has near-doubled, the BHP share price has soared by around 46%. In 2021 so far, BHP shares have returned 7.25%

Motley Fool contributor Lucas Radbourne-Pugh has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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