Copper isn’t getting any more plentiful or cheap. At least, that’s the party line from analysts, who are forecasting big things for the base metal’s exchange traded funds (ETFs).

There are a few reasons lurking behind those bullish prognostications:

  • China is expected to continue creating a major uptick in demand for copper as its economy expands and growth takes off.
  • Global copper supplies are tight and may remain so, which will help propel prices to $12,000 a tonne and higher as output struggles to keep up with healthy demand into 201, says Reuters on Financial Post. [New Copper ETF Tweaked; Global ETF Starts Trading.]
  • The prospect of a physically-backed ETF is further fueling the bull calls for copper. The prevailing belief is that such a fund would create additional demand for the metal, fueling further price gains.

Will Peters on The Economy News reports that although copper might be in a range now, the Bank of America has said that macroeconomic data for China and the United States support a rise in copper prices in 2012. [Why Copper ETFs Are Changing Direction.]

If that happens, look for some moves in First Trust ISE Global Copper (NASDAQ: CU) and Global X Copper Miners (NYSEArca: COPX) in the coming weeks and months.

Tisha Guerrero contributed to this article.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.