Should I Buy Copper Bars?

Posted - August 7, 2023
Should I buy copper bars?

While most stackers still prioritize traditional precious metals such as platinum, silver, and gold to build their portfolios, copper is an increasingly popular asset class. The reason why is no secret. After all, copper offers some of the most impressive technological use-cases of any metal. Despite extremely high premiums and a limited number of reputable manufacturing mints, copper bars are becoming one of the world’s favorite investments. 

Should I buy copper bars for my own collection? This is a popular question. As the global effort for infrastructural development increases demand for copper, investors who are bullish on mankind’s future might consider adding quality copper bars to their own collections. In this guide, we’ll explain everything you need to know to answer the question of the day: should I buy copper bars? 

Why Should I Buy Copper Bars? 

There’s a significant number of advantages to buying copper bars. Compared to other copper products, copper bars offer some of the lowest premiums available. This is especially important for low budget investors, considering the high cost of investing in copper products generally. But because copper bars offer a cheap way to invest directly in copper bullion, some of the benefits of this asset class are intricately tied to the advantages of buying copper itself. 

Don't Tread On Me 1 Pound Copper Bar
Don’t Tread on Me 1 Lb Copper Bar

We find five main advantages to buying copper bars: diversification, hedge against inflation, industrial demand, potential for capital appreciation, and easy storage and transport. We’ll walk you through all five of these benefits below. 

Diversification of Investment Portfolio

Copper can increase the diversity of your portfolio. Should I buy copper bars for portfolio diversity? Diversification alone isn’t a reason to invest in a new commodity, but it certainly helps. Investing in any precious metal can improve the health of your investment portfolio, as bullion products are non-correlated assets. 

Even among other precious metals, copper bullion can help you diversify. Metals like gold and silver are traditionally volatile. While copper most definitely isn’t a walk in the park when it comes to stability, price trends have been more consistent for copper bullion over the past decade. Unlike gold, copper’s value is largely determined by industrial demand. If you’re anticipating that bullish trends of demand will increase over the next few years, then copper is a good tool to help you diversify your precious metal collection. 

Should I buy copper bars to improve the quality of my investment portfolio? Many precious metal stackers have employed this strategy, and copper bars might be the most cost-effective way to put your money on this valuable bullion class. 

Hedge Against Inflation

Should I buy copper bars to hedge against inflation? Like all precious metals, copper bars can help you curb the effects of inflation over time. Bullion tends to perform better during times of economic insecurity. The value of fiat currency decreases during inflationary periods, but non-correlated assets like silver, gold, and copper help you remain profitable – even when the rest of the world is on fire. 

Industrial Demand for Copper

If we had to pinpoint one main reason why copper is so expensive and valuable to collectors, it would be industrial demand. Copper is used in hundreds of technologies, including air conditioning units, electrical wiring, and even phones. Some sources speculate that industrial need for copper bullion is going to increase in the next few years, while production is likely to stagnate – or even decrease. 

Copper’s demand isn’t going anywhere anytime soon. Should I buy copper bars because of copper’s industrial demand? Among other reasons, this is a justification for copper’s newfound dominance in the bullion sector. 

Potential for Capital Appreciation 

This benefit of buying copper should be obvious. Just like any other precious metal, copper can appreciate in value over time. Price trends over the last decade have been favorable, and many investors anticipate that the metal will become even more valuable in the next few years. With some governments moving to ban copper mining in key production areas, supply could also dwindle. This would make copper a more scarce resource, driving prices up even more. 

Element 1 Kilo Copper Bar
Element 1 Kilo Copper Bar

Should I buy copper bars for short-term profit? Probably not. While copper might experience significant price appreciation over time, short-term price swings for copper aren’t quite as common as for other precious metals, like gold and silver. Still, the long-term outlook for copper looks reassuring for steady-handed investors. 

Easy to Store and Transport

Compared to gold and silver, copper is simple to store and transport. Aside from exceptionally large and valuable collections, most copper portfolios are relatively inexpensive when weighed against the thousands of dollars required for a massive gold stockpile or silver stack. You shouldn’t have to worry about securing your copper with expensive safes or hiring professional security to transport it to another location. 

Should I buy copper bars because of their easy storage and transport? If you’re looking for a metal with very little storage cost requirements, copper bars are an excellent choice. 

Considerations Before Purchasing

Before you dive in and purchase large copper bars, there are a few considerations that you need to keep in mind. We’ll cover five things that you need to think about before buying copper bars: market conditions, storage and security arrangements, seller reputation and trustworthiness, copper market dynamics, and potential liquidity challenges. 

Current Market Conditions

Market conditions for copper are complex and can be difficult to gauge. But smart investors develop the tools and skills necessary to time the market. Copper’s price is influenced by a number of factors, including industrial demand, global supply, and investor speculation. We recommend researching how copper’s price is determined before investing in the first place. Should I buy copper bars in the current market? 

We’ll leave this question to you. You need to evaluate the market to figure out whether or not this is a good time to invest in quality copper bars. 

Storage and Security Arrangements

Unlike most precious metals, copper investments don’t need to be kept in large, fancy safes. While we do recommend at least some degree of security for any bullion investment, only the largest copper collections should be stored and transported with the care that we generally allot to gold, silver, and platinum stacks. Should I buy copper bars, and how do I store them? We recommend storing large copper collections in a basic safe before you build your stack too much. 

Seller Reputation and Trustworthiness

Most copper bars are produced by private mints. Some of these mints are small and come with limited reputation in the bullion industry. This doesn’t mean that they aren’t worth doing business with, but we do recommend that you research your manufacturing mint before purchasing your first large copper bar. Should I buy copper bars from a small, unknown mint? Reading reviews from verified customers can help you determine whether a mint is worthy of your cash. 

Understanding Copper Market Dynamics

Market dynamics like supply and demand influence the price of copper, much in the same way that they affect nearly any asset or commodity. But the copper market is also influenced by a number of additional factors, including market speculation. Understanding how the copper market works is your best bet when trying to answer the question: should I buy copper bars? 

Potential Liquidation Challenges

Copper is growing in popularity, and a cursory understanding of copper’s importance to the global infrastructural development scene justifies the recent spike in investor interest. But this interest might not hold forever, and liquidation challenges can make it more difficult for you to sell your copper when it’s time to secure some profit. Gold and silver fly off the shelves, and their intrinsic value makes it easy to profit in the long or short term. But as for copper, its value inherently pegged to its own industrial use-cases, meaning that simple profit is harder to come by. 

Copper Bars Vs. Other Investments

Let’s take a moment to compare copper bars to other investment classes. Should I buy copper bars, or is another precious metal a better investment option? We’ll compare copper with some of the other popular precious metal commodities in the next sections. 

Comparison With Gold and Silver

Gold and silver have intrinsic value, and their scarcity on Earth makes them inherently valuable to collectors. While gold, silver, and platinum spot prices are at least partially dependent on industrial applications, copper’s value is almost entirely pegged to use-cases in technology, business, and global development. 

Germania Mint 1 Kilo Cast Copper Bar Obverse
Germania Mint 1 Kilo Cast Copper Bar

This is a double-edged sword. On one hand, collectors can benefit from investing directly into global infrastructure through copper bars. But copper bars also come with higher premiums over spot than both gold and silver, making them troublesome choices for investors who are looking for a bargain. 

Copper Vs. Other Commodities

Some copper investors also like putting their money on other commodities, such as oil or fiat currencies. Copper offers the benefits of a non-correlated asset, but it also has value pegged to real-world use-cases. Should I buy copper bars over other commodities? We tend to think that its benefits outweigh the high premiums over spot associated with copper bullion. 

Evaluating Risk and Reward

Always consider both risk and reward when making any new investment. Copper isn’t any exception. Copper is a solid investment choice, especially if you want to put money into the actual global development infrastructure.

The diminishing presence of copper mines in countries like the United States might also decrease supply and increase prices. But it’s also possible that other metals with a less environmentally dangerous extraction process might mitigate prices in the future. Carefully research the risks and rewards of investing in copper bars before investing. 

Should I buy copper bars, or are they too risky of an investment? This choice is one that you alone can make. 

Potential Downsides of Copper Investment

We’ve covered the benefits of investing in copper bars extensively, so it’s about time we give some attention to the downsides of copper bullion. There are four main risks to investing in copper, especially when we compare it to other, similar metals: copper price volatility, limited use as currency, industrial dependency risks, and counterfeit concerns. 

Copper Price Volatility: Should I Buy Copper Bars?

Copper’s price isn’t especially volatile, but short-term price swings aren’t unheard of. Before you answer the question of, “should I buy copper bars,” familiarize yourself with the volatility of the commodity you choose to buy. 

Limited Use as Currency

Unlike gold and silver, copper is almost never used as an actual currency. Old American currencies sometimes use copper and can be exchanged for goods and services, but it’s tough to find people to accept copper bars as payment for anything. Their limited use as currency makes it difficult for some consumers to justify spending the money on a copper bar that they’d be willing to pay for a quality gold bar from the U.S. Mint or the British Royal Mint. 

Industrial Dependency Risks

While we value copper for its industrial applications, this aspect of the precious metal also makes it a dangerous commodity to hold. Copper might not always be used as the world’s most important industrial metal. If other metals substitute for copper and provide a better use-case justification, copper might become less valuable. 

Hero Bullion 1 Kilo Copper Bar
Hero Bullion 1 Kilo Copper Bar

It’s even more important that investors understand the risks associated with copper’s environmental problems. Growing concerns about the impact of copper mining on the environment might make it profitable for companies to transition from copper to another metal to make their most popular products, which could tank copper’s value. Should I buy copper bars, or will they be replaced by other metals? For now, only time can tell. 

Counterfeit Concerns

Counterfeiting isn’t a major concern with copper bars. This is mostly because copper is less expensive than gold or silver, so you’re not likely to lose a ton of money – even if you buy a copper bar. Should I buy copper bars, or are counterfeits possible? It’s always possible to get a counterfeit when you buy copper. Only do business with dealers you trust, and you can ensure that you’ll never be given a fake copper bar. 

Final Thoughts: Should I Buy Copper Bars? 

So, should I buy copper bars? We consider copper bars to be an exceptional investment, even though they come with considerable downsides. Copper is used in some of the most important technologies that humanity has ever invented, and the future of global development hinges on this essential precious metal. 

Do you have questions about how to invest in high quality copper bars? Don’t hesitate to contact our customer support team today for specialized guidance.

About The Author

Michael Roets is a writer and journalist for Hero Bullion. His work explores precious metals news, guides, and commentary.