Chinese copper demand could mean long-term price rise in key commodityManufacturers and supply chain managers should probably be keeping an eye on a seemingly esoteric statistic - China's consumption of copper, particularly in its developing, rural areas. The red metal is sometimes referred to as "Doctor Copper," because it's a sensitive barometer of economic health.

Copper wires, tubing, filaments and chips have infiltrated pretty much every major industrial and consumer product, so demand tends to surge when people are buying and selling a lot of goods. When recessions hit and production scales back, the price falls.

China is in the midst of an unprecedented shift from subsistence farming and agrarian life to a modern industrial society, and as it modernizes, it's consuming more and more resources every day. This year, it passed Japan as the world's second-largest economy by gross domestic product, and it's now the biggest consumer of energy on the globe.

In doing so, it's pushed up the prices of commodities like oil, coal, cotton, wheat and copper. Any industry that has copper somewhere in its supply chain - such as computer manufacturing, solar panels, smartphones, construction supplies or even biomedicine - will probably be experiencing higher costs over the next few years as China's consumption ramps up.

Indeed, a recent Bloomberg report suggested that over the next 25 years, China will triple its annual copper consumption to 20 million tons - more copper than is produced in the entire world today.
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