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.

| More on:
Mining worker making frame with his hands and peering through it

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

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.

More on Resources Shares

busy trader on the phone in front of board depicting asx share price risers and fallers
Resources Shares

Why did investors keep buying BHP and Fortescue shares amid price falls in FY25?

BHP and Fortescue shares were the most traded stocks of FY25 and had the highest buy ratios, data shows.

Read more »

Three miners stand together at a mine site studying documents with equipment in the background
Resources Shares

Up 46% since June, should you still buy Pilbara Minerals shares right now?

A leading expert offers his verdict on Pilbara Minerals' resurgent share price.

Read more »

Female miner smiling at a mine site.
Resources Shares

Up 60% this year, this ASX 200 mining stock just smashed production records

Production surge headlines quarterly results.

Read more »

a man in a hard hat and high visibility vest smiles as he stands in the foreground of heavy mining equipment on a mine site.
Resources Shares

After lifting its price target, Macquarie now expects 36% upside from this ASX mining stock

The precious metals producer released better-than-expected production guidance.

Read more »

A miner in a hardhat and high visibility clothing makes a thumbs up symbol.
Resources Shares

4 reasons to buy Rio Tinto shares today

A leading expert forecasts strong growth potential for Rio Tinto shares.

Read more »

Man with rocket wings which have flames coming out of them.
Resources Shares

Why Macquarie expects this ASX All Ords copper stock could surge 38%

With costs coming in below expectations, this ASX All Ords copper stock could rocket higher over the coming months.

Read more »

Iron ore price Vale dam collapse ASX shares iron ore, iron ore australia, iron ore price, commodity price,
Resources Shares

Major miners up as China announces new mega project

Can a new mega-dam absorb iron ore oversupply?

Read more »

A young man sits at his desk with a laptop and documents with a gas heater visible behind him as though he is considering the information in front of him. about the BHP share price
Broker Notes

Leading broker has just downgraded BHP shares. Is it time to sell?

Macquarie sees little upside. But why?

Read more »