Copper futures held steady near $4.90 per pound on Thursday, maintaining strong weekly gains of nearly 5% as supply-side disruptions and escalating trade tensions continued to drive bullish sentiment in the market. The industrial metal, widely used in construction, electronics, and renewable energy infrastructure, has seen renewed investor interest amid a tightening global supply outlook and growing geopolitical uncertainty.
Copper holds advance on supply concerns
Key to the recent price surge are ongoing production challenges at major mining operations. Teck Resources’ Quebrada Blanca Phase 2 project in Chile—one of the world’s largest new copper developments—has experienced prolonged operational delays due to technical setbacks and labor disputes, with analysts now anticipating output disruptions to persist well into the second half of 2025. Simultaneously, the Kamoa-Kakula mine in the Democratic Republic of Congo, jointly operated by Ivanhoe Mines and Zijin Mining, reported unexpected logistical issues linked to regional instability, curbing copper concentrate shipments and tightening near-term global availability.
These disruptions are compounding an already fragile supply chain, where years of underinvestment in new mining projects and declining ore grades in mature deposits have created structural constraints. Inventories on major exchanges, including the LME and SHFE, remain at historically low levels, further amplifying market sensitivity to supply shocks.
Meanwhile, geopolitical tensions added a fresh layer of uncertainty. President Donald Trump signed an executive order this week to double tariffs on steel and aluminum imports to 50%, reigniting fears of a broader protectionist agenda. Although copper was not directly targeted, the move raised speculation that it could soon face similar scrutiny. The U.S. government has launched an official investigation into copper imports under the premise of national security—mirroring the approach used before enacting the aluminum and steel tariffs—creating a cloud of uncertainty for global trade flows and investor positioning.
Further details
Despite the tightening supply picture and growing trade risks, copper’s rally has been somewhat tempered by softer macroeconomic signals from China, which accounts for more than half of global copper consumption. Recent data showed weaker-than-expected manufacturing and services activity in May, with the official NBS Manufacturing PMI slipping below the expansion threshold and the Caixin Services PMI also showing a slowdown. These indicators suggest that China’s post-pandemic recovery remains uneven, with sluggish property investment and tepid domestic demand continuing to weigh on industrial output.
Still, the long-term demand outlook for copper remains broadly positive. The metal is a critical component in electrification, energy transition technologies, and electric vehicle production—all sectors expected to see structural growth over the coming decade. Analysts note that short-term volatility is likely to persist as markets weigh near-term demand risks against tightening supply fundamentals and potential policy shifts in major economies.
Looking ahead, traders are closely watching upcoming economic data from both the U.S. and China, as well as any further policy moves from Washington related to tariffs or critical mineral strategy. In the meantime, copper is expected to remain well-supported, with price momentum likely tied to the unfolding balance between constrained global supply and the durability of end-user demand.
