1. Scarcity
Gold: Gold is a rare metal, found in the earth’s crust at extremely low levels (around 0.004 ppm), and is expensive to mine and produced in limited quantities. Global gold reserves are relatively small and scarcity directly drives up its price.
Copper: Copper has a high content in the earth’s crust (about 50 ppm), is abundant and relatively easy to mine. Copper is widely available globally and in good supply, hence its low price.
2. Physical and Chemical Properties
Gold:
Chemically extremely stable, does not oxidise or corrode easily and retains its lustre over time.
It has excellent ductility and is easy to work into a variety of shapes.
High density and soft texture, suitable for jewellery and high-end industries.
Copper:
Although excellent in electrical and thermal conductivity, it oxidises easily (forming a patina) and requires additional treatment to maintain performance.
Higher hardness makes it suitable for industrial use, but less valuable in jewellery and decoration.
3. Market demand
Gold:
As a precious metal, gold has financial properties and is widely used for investment, reserves and hedging (e.g., gold bars and coins).
There is a huge demand for gold in the jewellery industry, especially in Asia and the Middle East.
Central banks and financial institutions hold large quantities of gold as a reserve asset.
Copper:
It is mainly used in industrial sectors such as electrical, construction and transport, and demand is closely linked to economic cycles.
Copper is consumed in large quantities, but its price is driven more by supply and demand and industrial demand than by investment demand.
4. Historical and cultural factors
Gold:
Since ancient times, gold has been regarded as a symbol of wealth and power, and has great cultural and historical value.
Its value is further enhanced by its importance in religion, art and luxury goods.
Copper:
Copper, despite its long history (e.g. Bronze Age), is seen more as a utility metal and lacks the symbolism and cultural premium of gold.
5. Production Costs
Gold:
Gold is expensive to mine and requires the processing of large quantities of ore to extract small amounts of gold (typically only a few grams of gold per tonne of ore).
The refining process is complex and energy intensive.
Copper:
Copper ores are of high grade and have relatively low mining and refining costs.
The large-scale production of copper reduces the unit cost.
6. Financial Properties
Gold:
Gold has monetary properties and is considered a ‘hard currency’ and a safe-haven asset in times of economic instability.
The gold market is highly liquid and the price is highly influenced by the volatility of the financial markets.
Copper:
Copper is considered more of an industrial commodity, with prices influenced by supply and demand, economic cycles and industrial activity.
Copper’s financial attributes are weak and investment demand is much lower than for gold.
Price comparison (in 2023, for example)
Gold: approximately 60-65 Yuan/g (RMB).
Copper: approximately $0.06-0.07/g (RMB).
Summary
The price difference between copper and gold mainly stems from the differences in scarcity, market demand, cultural values and production costs. Gold is much more expensive than copper due to its rarity, financial attributes and cultural symbolism, while copper, as an industrial metal, is less expensive due to its abundant supply and lack of investment attributes despite high demand.
