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Visualizing Copper’s Global Supply Chain

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Copper Supply Chain

Copper is all around us: in our homes, electronic devices, and transportation.

But before copper ends up in these products and technologies, the industry must mine, refine and transport this copper all over the globe.

Copper’s Supply Chain

This infographic comes to us from Trilogy Metals and it outlines copper’s supply chain from the mine to the refinery.

Copper's Supply Chain

Copper Deposits Around the World

Copper is a mineral that comes from the Earth’s crust. However, natural history did not evenly distribute it around the world. There are certain geological conditions that need to happen to make an economic deposit of copper.

There are two primary types of copper deposits:

  1. Porphyry Copper Deposits

    These copper ore deposits form from hydrothermal fluids coming from magma chambers below the copper deposit. These are currently the largest source of copper in the world.

  2. Sediment-hosted Copper Deposits

    These are copper deposits that occur in sedimentary rocks that are bound by layers. They are formed by the cooling of copper-bearing hydrothermal fluids.

Copper-containing rock or ore only has a small percentage of copper. Most of the rock is uneconomic material, known as gangue. There are two main copper ore types in mining: copper oxide ores and copper sulfide ores.

Both ore types can be economic, however, the most common source of copper ore is the sulfide ore mineral chalcopyrite, which accounts for ~50% of copper production.

Sulfide copper ores are the most profitable ores because they have high copper content, and refiners easily separate copper from the gangue. Sulfide ores are not as abundant as the oxide ores.

Copper Trade Flows

While copper is a global business, there are clear leaders in the production and refinement of copper based on geology and demand. Chile is the major source for copper, exporting both mined and refined copper.

In a list of the 20 biggest copper mines, 11 reside in Chile and Peru accounting for 40% of mined copper. Meanwhile, China is a leading importer and exporter of refined copper, and it’s home to 9 of the 20 biggest copper smelters in the world.

Copper Imports/Exports

However, this concentrated geography of supply creates risks for the the copper trade.

Inherent Risks

While Chile is one of the richest sources of copper in the world, the mining industry has exploited copper deposits to the point where the grade or quality of the copper ore is declining.

Codelco, the national copper miner of Chile and the world’s largest producer of copper, plans to spend $32B by 2027 to extend the life of its current mines and maintain its copper output.

In addition to declining grades, the geography of copper mining exposes the risk of supply disruption by natural forces.

The borders of Chile and Peru overlap the intersection of the Nazca and the South American Tectonic plates. Movement of these plates can produce powerful earthquakes.

According to one study, regions in Chile and Peru face a greater than 85% chance of a serious earthquake in the next 50 years, potentially disrupting copper mining operations. And according to Wood Mackenzie, a 15-day closure of copper mines in Chile and Peru could wipe out 1.5% of global annual production, or 300,000 tons of copper.

Falling grades and tectonic risk suggest that mining costs are likely to increase, making copper production more expensive and new discoveries more valuable.

Copper for the Future: New Discoveries

As economies grow and infrastructure needs increase, the demand for copper will grow. However, without new discoveries and sources of production, the world could face a shortage of the red metal.

According to data from S&P and the London Metals Exchange, the discovery of copper has not kept up with investment in copper exploration. If this trend persists, there will not be enough copper to replace current resources. On top of this, production from already producing copper mines face resource exhaustion and declining grades.

In order to maintain copper’s supply chain, the world needs new copper discoveries to ensure everyone has access to the materials and products that make modern life.

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Forex Market: Unlocking Opportunities for Investors

What are the advantages of the forex market? Individual investors can access this expansive, global market—largely unknown to many.

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Forex Market: Unlocking Opportunities for Investors

In 2019, the global foreign exchange market (forex) was valued at a jaw-dropping $2.4 quadrillion.

In fact, this is equal to more than 50 times China, Japan, Germany, India and the U.S.’s economic output combined. Institutional investors, such as investment banks, pension funds, and large corporations have typically dominated this space, but there are avenues for individuals to enter the market as well.

This infographic from Compare Forex Brokers breaks down the world’s most interconnected financial market, and how individual investors can start trading.

The Forex Market: A Global Landscape

Across the forex market, 170 major, minor, and exotic currency pairs can be traded as contracts for difference (CFDs). A CFD enables you to speculate on whether the price of an asset will rise or fall.

Here, trades are conducted on over the counter (OTC) markets—non-centralized markets made up of a network of participants. This is different from traditional markets, such as the S&P 500 and the Nasdaq, which operate on formal, centralized exchanges.

While the forex market is by nature, decentralized, these core regions show where forex transactions are most concentrated by market participants including banks, commercial businesses, or individual investors.

Globally, the majority of forex trading takes place within the following hubs.

Forex Trading Centers (2019)CountryShare of Global Over the Counter (OTC) Forex Turnover
1UK43.1%
2U.S.16.5%
3Singapore7.6%
4Hong Kong7.6%
5Japan4.5%
6Switzerland3.3%
7France2.0%
8China1.6%
9Germany1.5%
10Australia1.4%

Source: BIS

The UK accounts for over 43% of global forex trading, averaging $2.7 trillion daily according to the 2019 Triennial Central Bank Survey by the Bank for International Settlements. London’s geographic location between the U.S. and Asia makes it an optimal forex trading centre—a trend that has held strong over the last 50 years.

With forex trading in the U.S. jumping over 50% in the last decade, the U.S. is the next most active forex market. Meanwhile, averaging $633 billion in trading volumes in 2019, Singapore is Asia’s largest forex trading center, with Hong Kong following close behind.

The Top Seven Currency Pairs

What are the most highly-traded currency pairs?

Overall, 68% of global forex trading falls into seven major currency pairs.

 Top Seven Currency PairsPercentage of Total
1United States Dollar vs Euro24.0%
2United States Dollar vs Japanese Yen17.8%
3United States Dollar vs Great British Pound9.3%
4United States Dollar vs Australian Dollar5.2%
5United States Dollar vs Canadian Dollar4.3%
6United States Dollar vs Chinese Yuan3.8%
7United States Dollar vs Swiss Franc3.6%

Source: BIS

Currency prices are impacted by factors including inflation, international trade, political stability, among other macroeconomic factors.

Breaking Down Institutional and Retail Trading

While commercial and central banks, hedge funds, and investment managers make up most of the forex market, only 5.5% are individual investors.

Importantly, they differ in a few key ways.

Institutional Forex TradingRetail Forex Trading
- Buy and sell the physical currency


- Interdealer market: Large institutions trade on an interdealer market, which is a non-centralized network of dealers


- Less formal: Often trades are conducted by phone, email or instant message.


- Non-transparent: Execution prices and buy/sell orders are not visible to the market.
- Buy and sell contracts for difference (CFD)


- Contracts for Difference (CFD): CFDs allow traders to speculate on the price of an underlying asset. Traders do not own the underlying asset.


- Long and Short Trades: Traders can take a long or short position:


- Long position: buying a CFD with the expectation the asset's market price will increase.


- Short position: selling a CFD with the expectation the asset's market price will decrease.

For various reasons, retail forex trading increases in popularity year after year. However, before diving in, it is important to know the stakes involved in this speculative market.

Understanding the High Risk of Forex Trading

Retail forex trading is, at is core, very risky.

In 2019, 71% of all retail forex trades lost money. One explanation is the highly leveraged nature of the market—many investors trade using borrowed money. But while trading with leverage can magnify losses, it also applies to gains.

Key Benefits of the Forex Market

While there is risk inherent in the market, what are some of the advantages in forex trading?

  1. Low transaction costs: No exchange or regulatory fees. Overall trading costs are low with both commission and no commission pricing structures available.
  2. High liquidity: Along with being the largest market globally, it is also the most liquid with $6.6 trillion in daily trading volume.
  3. 24-hour market: Trading is not confined to limited hours or time zones.
  4. Leverage: Forex brokers offer retail traders leverage which allows the to increase their exposure

Unlike equities, currency trading is all about relativity. A currency can depreciate overall, but can also appreciate relative to a currency that has depreciated even more.

Connect to New Markets

While big gains are possible, many trades lose money, but regulatory improvements have helped build trust in the market.

Meanwhile, multiple digital platforms provide a link to global currencies, allowing retail forex traders to enter the market and trade from any location. For those comfortable taking more risk, currency markets offer opportunities with outsized potential.

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Investing in the Impending E-commerce Future

E-commerce is already massive, but COVID-19 has proven to be an unexpected catalyst in driving the use of digital marketplaces.

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Investing in the Impending E-commerce Future

The rise of e-commerce has been a long time coming, but the market’s progressive size and impact has caught many by surprise.

Tied initially to the advent of the internet and the Dot-com boom, online shopping saw companies like Amazon and eBay become well-known billion-dollar names. Digital commerce was a big market, but only for a few players.

Fast forward to today, and more companies than ever are launching their own marketplaces or embracing online retail. The shift was happening before COVID-19, but the pandemic has sped things up dramatically.

Today’s infographic from eToro highlights the increasing relevance of e-commerce in the modern economy and how investors can enter the market.

The Digital Marketplace Footprint

How big is modern e-commerce? While multiple sectors are experiencing their own online revolutions, retail is leading the way.

Total global retail e-commerce sales already numbered $3 trillion in 2018, and are expected to more than double to $6.5 trillion in 2023.

The increasing ease and security of online payments have encouraged many businesses to embrace B2C sales, especially in light of a pandemic that forced many brick and mortar stores to close. But less documented is the boom of digital marketplaces, which accounted for 57% of global online retail sales in 2019.

The biggest marketplaces are well-known leaders like Amazon and China’s Taobao and Tmall, but more and more companies are capturing a slice of the online distribution market.

Largest U.S. MarketplacesGross Merchandise Value
Amazon$339B
Ebay$90B
Walmart$49B
Wish$10B
Houzz$9B

Source: DigitalCommerce360

Walmart and Best Buy have both launched marketplaces for third-party product sales, with Walmart recently seeing a 79% increase of e-commerce sales alone.

The E-commerce Transformation

The growth of e-commerce in retail by itself is staggering, but its growing availability in other sectors is the bigger story.

Groceries and restaurants are a key marker, with home-delivery of takeout, groceries, and ready-to-prepare meal-kits all ordered digitally. Companies like Doordash, Just Eat, and Uber Eats have experienced massive growth, with Doordash positioning for a 2020 IPO, while grocery retailers including Walmart and Safeway are embracing delivery sales.

Online services are likewise rising in popularity, including everything from streaming services to virtual meetings, healthcare and assistance. Just as with the retail sector, e-commerce is making its way into sectors previously thought to be “un-digitizable.”

That type of transformation is usually slow, but the result of COVID-19 restrictions forcing thousands of businesses to go digital sped up the schedule. U.S. e-commerce penetration experienced 10 years of growth in the first quarter of 2020 alone.

YearU.S. E-commerce Penetration
201611.8%
201713.2%
201814.4%
201916.0%
2020 (Q1)33.0%

Source: McKinsey

A Widening Landscape for Future Growth

It might be hard to believe, but even with the headway made by e-commerce over the past year, the industry is slated for massive future growth.

One big reason is the rising demand for digital goods and services. As the global pandemic has reimagined virtual business, many companies have also come face-to-face with the decreased costs of operating remotely, while retailers are seeing higher margins by cutting out the distributor (or the lease).

At the same time, another massive shift is the increase in technological capabilities. Alongside the rollout of 5G, blockchain, and improved AI, companies are looking for tech to streamline their processes and keep customers online where possible.

That includes the use of drones for delivery by Amazon, augmented and virtual reality for product testing by Ikea and Wayfair, and improved payment platforms by Shopify.

While 100% online shopping is still a ways away from becoming a reality, the wave of e-commerce is set to continue rising.

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