Copper prices saw some gains during the first quarter of the year, but supply concerns and rising demand caused the copper price to surge in Q2 to a record high on the COMEX of US$5.20 per pound, or US$11,464 per metric ton, on May 20.
Although strong demand from the energy transition has been expected to impact supply chains for some time, lower treatment charges from Chinese refiners during the first quarter introduced added pressure into the market. The low charges caused cuts to output, ultimately bottlenecking the supply of refined copper to end users.
How have TSX-listed copper companies performed since the start of 2024? Learn about the top 5 best performing copper stocks in 2024 below.
Data for this article was retrieved on July 16, 2024, using TradingView’s stock screener, and only companies with market capitalizations greater than C$50 million are included.
1. Taseko Mines (TSX:TKO)
Year-to-date gain: 75 percent; market cap: C$941.54 million; share price: C$3.22
Taseko Mines is a copper producer and development company and holds a portfolio of assets in British Columbia, Canada and Arizona, US.
Its primary asset is the Gibraltar mine located in Central BC. The mine is Canada’s second largest open-pit copper mine after Teck Resources’ (TSX:TECK.A,TECK.B,NYSE:TECK) Highland Valley mine. Gibraltar boasts an 85,000 MT per day processing capacity and in 2023 produced 123 million pounds of copper.
On March 25, Taseko acquired 100 percent ownership of the Gibraltar mine after it entered into an agreement with Dowa Metals and Mining (TSE:5714) and Furukawa (TSE:5715) to purchase the remaining 12.5 percent interest in the property. The company said the agreement was made as both Dowa and Furukawa are divesting themselves of their copper-mining investments.
On June 1, Taseko announced that operations at Gibraltar had been suspended due to strike action being carried out by mine workers. The strike lasted approximately two weeks, with the company and union coming to terms on a new agreement.
The company announced on June 19 that the union ratified the agreement and that operations restarted at concentrator 2. It added that concentrator 1 would continue to remain offline while the crusher relocation project and general maintenance are completed.
Shares in Taseko reached a year-to-date high of C$4.05 on May 27.
2. Alta Copper (TSX:ATCU)
Year-to-date gain: 72.22 percent; market cap: C$52.2 million; share price: C$0.62
Alta Copper is a copper exploration company that is working to advance its flagship Cañariaco project in Northern Peru. The project includes the Cañariaco Norte and Cañariaco Sur deposits and the Quebrada Verde prospect.
On May 15, the company released figures from an optimized preliminary economic assessment. In the report, the company indicated a base case pre-tax net present value of US$4.1 billion with an internal rate of return of 32.4 percent based on copper prices of US$4 per pound along with all-in sustaining costs of US$1.96 per pound of copper.
On the production side, Alta reported the projected life of the mine was 27 years, with an average annual metal production in the first 10 years of 347 million pounds of copper, 70,000 ounces of gold and 1.5 million ounces of silver.
In a follow-up technical report released on June 11, Alta shared updated resources for its project at cutoff grades of 0.1 percent copper. According to the report, Cañariaco Norte hosts measured and indicated resources of 9.33 billion pounds copper, 2.16 million ounces of gold and 60.37 million ounces of silver from 1.13 billion metric tons (MT) of ore, as well as additional inferred resources of 2.41 billion pounds of copper, 520,000 ounces gold and 16.9 million ounces of silver from 416 million MT of ore.
The company also reported inferred resources for the Cañariaco Sur deposit, with 2.52 billion pounds of copper, 1.34 million ounces gold, 17.61 million ounces of silver and 24.04 million pounds of molybdenum.
Shares in Alta reached their year-to-date high of C$0.79 on May 20.
3. Hudbay Minerals (TSX:HBM)
Year-to-date gain: 67.61 percent; market cap: C$4.94 billion; share price: C$12.18
Hudbay Minerals is a copper production and development company with producing mines in Peru and Canada, as well as projects in Peru and the US states of Arizona and Nevada.
According to Hudbay’s Q1 results, the Constancia mine and neighboring Pampacancha satellite pit in Peru produced a combined 24,576 MT of copper in the first three months of 2024. Copper Mountain in BC produced 7,024 MT of copper and Snow Lake in Manitoba produced an additional 3,149 MT of copper.
In addition to its mining assets, the company is also working to advance its Copper World project in Arizona. In the Q1 report the company indicated it is continuing to work on receiving the final state permits for the site and expects to receive them sometime in 2024. The company is also in the process of completing a three prerequisites plan that is required for sanctioning which it expects in 2025.
When complete, the mine is expected to have a 20 year life span, and according to a mineral resource estimate included in a March 28 annual reserve and resource update, Hudbay reported proven and probable average grades of 0.54 percent copper from 385 million MT.
The company is also working on its greenfield Mason project in Nevada. Hudbay says it is developing the project as a long-term future asset and expects it to have a 27 year lifespan.
Resource estimates from the site show measured and indicated average grading of 0.29 percent from 2.22 billion MT of ore, with additional inferred grading of 0.24 percent from 237 million MT.
On May 24, the company announced it had completed an upsized bought deal offering, generating proceeds of US$402.5 million for the sale of 42.37 million common shares at US$9.50 per share. The company said it intends to use funds for near-term growth initiatives and accelerate development at its Copper Mountain asset.
Shares in Hudbay reached a year-to-date high of C$14.15 on May 20.
4. First Quantum Minerals (TSX:FM)
Year-to-date gain: 64.23 percent; market cap: C$15.32 billion; share price: C$17.77
First Quantum Minerals is a copper mining and development company with a global portfolio of assets.
Its primary asset has been the Cobre Panama mine located west of Panama City, Panama. The mine boasts 3 billion MT of proven and probable reserves and represents 1 percent of the World’s copper supply. The mine was ordered to close down in November 2023 after the Panamanian Supreme Court invalidated an extension to the mine’s license.
In a December 2023 release, the company said it was working on developing a closure plan for the mine that it expects to present in June 2024, but also noted it is pursuing all appropriate legal avenues to protect its investment and rights.
In the company’s Q1 2024 financial update, released on April 24, First Quantum said it was continuing to work on a preservation and safe management plan for Cobre Panama, and was also working to deliver the 121,000 MT of concentrates that remain on site.
Due to the ongoing situation in Panama, the company noted that it has undergone a refinancing program to improve its balance sheet and improve liquidity. This program has included working out a prepayment agreement with Jiangxi Copper for US$500 million, the completion of a US$1.6 billion senior secured second-lien at 9.38 percent due in 2029, and the issuance of 139.93 million common shares to raise proceeds of US$1.15 billion.
In addition to the updates on its mine in Panama, First Quantum reported the production of 100,605 MT of copper through Q1, down 59,595 MT compared to Q4 2023. The production drop was largely attributed to the closure of Cobre Panama.
The company is also operating several mines in Zambia, including its Kansanshi copper-gold mine, Sentinel copper mine and Enterprise nickel mine. First Quantum noted that production may be impacted in 2024 due to severe drought conditions in Zambia caused by El Nino, which reduced water levels in the Kafue and Zambezi rivers. This led the government to declare a national emergency in March, and power generation throughout the country has been impacted.
First Quantum has been working to mitigate these challenges and entered into offtake agreements with third-party traders for power sourced from the Southern African Power Pool for a total of 80 megawatts. The agreements are expected to cost US$25 million.
Shares of First Quantum reached a year-to-date high of C$20.00 on May 20.
5. Capstone Copper (TSX:CS)
Year-to-date gain: 53.3 percent; market cap: C$7.81 billion; share price: C$9.74
Capstone Copper is a mining company with a portfolio of assets in the US, Mexico and Chile.
Capstone’s 100 percent owned Pinto Valley copper mine in Arizona, US, is fully permitted until 2039 and is expected to produce 58,000 to 64,000 MT of copper in 2024. Capstone acquired Pinto Valley from BHP in 2013, and the mine has produced more than 4 billion pounds of copper since it began operating in 1972.
It also is the sole owner of the Cozamin copper and silver mine in Zecatacas, Mexico, which boasts a 1,000 MT per day throughput and is projected to generate 22,000 to 24,000 MT of copper in 2024, as well as the Mantos Blancos copper mine in Antofagasta, Chile, which underwent an expansion in 2021 to extend its mine life significantly.
The company also owns a 70 percent stake in the Mantoverde mine in the Atacama region of Chile, with the remaining 30 percent owned by Mitsubishi Materials (OTC Pink:MIMTF,TSE:5711). The mine is currently in the process of ramping up to commercial production, and Capstone announced on June 25 that it produced its first saleable copper concentrate. Capstone expects to achieve nameplate operating rates during Q3 of 2024.
Shares in Capstone reached a year-to-date high of C$11.20 on May 16.
FAQs for investing in copper
Is copper a good investment in 2024?
Many experts have a positive long-term outlook for the red metal based on supply concerns and its growing role in the energy transition. Copper’s price has climbed to new all time highs in 2024, bringing many stocks with it.
Investors who are interested in copper should make sure to perform their due diligence, as the volatility and unpredictability of markets and economies at the moment means that nothing is guaranteed.
What is copper used for?
Copper is used in many industries, from construction to electronics to medical equipment. In fact, in 2020, 32 percent of copper globally was used in equipment manufacturing and 28 percent in building construction.
Two other growing sectors for copper are the burgeoning electric vehicle and green energy industries. Electric vehicles require a significant amount of the red metal per vehicle.
How to invest in copper?
Investors can get exposure to copper in a variety of ways. Holding physical copper is possible, but plenty of storage would be required to hold any significant value of the metal.
For investors looking to invest in the metal without physically holding it, there are a few options. Copper stocks such as those on the TSX, TSXV and ASX are worth looking at. Additionally, there are copper exchange-traded funds and the copper options and futures markets on the London Metal Exchange.
How to invest in a copper ETF?
Copper exchange-traded funds (ETFs) can be a good way to diversify an investment portfolio, and they can be a more stable option compared to individual copper miners or explorers. There are multiple options available on the market, and they can usually be purchased in the same way one could purchase stocks through a broker or trading platform.
In May 2022, Horizons launched Canada’s first copper equities ETF, the Horizons Copper Producers Index ETF (TSX:COPP), which is focused solely on pure-play and diversified copper-mining companies.
There are two ETFs available on the US ARCA exchange as well. The Global X Copper Miners ETF (ARCA:COPX) tracks the Solactive Global Copper Miners Index, which includes copper miners, as well as copper explorers and developers. The other option is the United States Copper Index Fund (ARCA:CPER), which gives investors exposure to copper futures contracts by tracking the SummerHaven Copper Index Total Return (INDEXNYSEGIS:SCITR).
How is copper priced?
The copper price is tracked in two ways: COMEX copper and London Metal Exchange (LME) copper. The COMEX and LME are both options and futures metal exchanges, with the former being headquartered in New York and the latter in London. COMEX copper is priced by the pound, while LME copper is priced per metric ton.
How is copper processed?
Once copper is mined, the ore goes through multiple steps to reach a market-ready state. First, the ore is ground to roughly separate the rock from the copper, as copper typically only makes up 1 percent of the mined rock.
The resultant copper is then slurried with water and chemical reagents, after which air is used to float the copper to the top of the mixture. After the copper is removed from this, it is typically at 24 to 40 percent purity.
Where is copper mined?
Copper is mined throughout the world, with significant production found on every continent besides Antarctica. Chile was the top producer in 2022, putting out 5 million metric tons of the metal. Rounding out the top five are Peru with 2.6 million MT, the Democratic Republic of Congo with 2.5 million MT, China with 1.7 million MT and the United States with 1.1 million MT.
Article by Dean Belder; FAQs by Lauren Kelly.
Securities Disclosure: I, Dean Belder, hold no direct investment interest in any company mentioned in this article.
Securities Disclosure: I, Lauren Kelly, hold no direct investment interest in any company mentioned in this article.
