Pertes & profits. Ivan Glasenberg is not exactly a star among environmentalists. But the CEO of Glencore is the world’s largest commodity broker, so when he talks about copper prices everyone listens to him. To meet government carbon neutrality objectives in 2050, “We will need a copper at 15,000 dollars [12 400 euros] the ton “, he said, Thursday, May 6, during a conference organized by the Financial Times. That is to say an increase of 50% compared to the current price, already at the highest for ten years.
This is the price of the green revolution. Copper is the most abundant metal in renewables and in electric cars. To cope with the explosion in demand, it will be necessary to prospect more, while easily accessible deposits are already overexploited. Not to mention the new environmental constraints on extraction which also apply to miners. In fact, all commodities are on the rise. ArcelorMittal, the world’s leading steelmaker, posted record results in the first quarter, driven by the surge in steel prices. And it promises that, by 2030, nearly 50% of its steel will be produced without CO emissions.2.
A chance for renewal for capitalism
Expensive copper, expensive steel, this means that all downstream industries will experience a considerable inflation in their costs, which will come on top of their own increase in the price of their product, due to environmental constraints. In presenting his new strategy, the new boss of Renault, Luca de Meo, has announced targeting a turnover per car of 30,000 euros for his new range, compared to an average income of 15,000 euros currently. The first electric car of its low-cost subsidiary Dacia, the Spring, yet manufactured in China, is sold from 17,000 euros, while its petrol equivalent, the Sandero, costs 9,000.
Of course, progress in productivity will gradually lower prices, but if, as manufacturers now fear, the new standards under discussion in Brussels ban thermal cars from 2025, the rise in prices will be spectacular, and this is the case. purchasing power of the most modest which will suffer. We could extend the reasoning to all products, especially agricultural products, with the rise of organic products.
It’s the new inconvenient truth. But as the economist Pierre Dockès, a specialist in the history of capitalism, underlines in an interview with the Polytechnique online review, Polytechnique Insights, it is also a chance of renewal for capitalism. The promise of the end of stagnation and of new productivity gains under the constraint of the State, as it had known how to reinvent itself under social constraint throughout the XXe century. A childbirth that will not be painless.