Copper price gains on Chinese demand as Chilean supply risks loom

[Redator]

Copper prices edged higher on Thursday, driven by strong Chinese trade data that signaled robust industrial demand, while supply risks from Chile began to cast a shadow over the market outlook.

China reported an unexpected surge in both imports and exports in July. Total exports jumped 7.2% from a year earlier, outpacing economists’ projections of 5.6%, as manufacturers expanded into alternative markets despite ongoing US tariffs imposed by President Donald Trump.

This export-led momentum is sustaining demand for industrial metals like copper, which are essential components in cars, appliances, electronics, and construction. Chinese manufacturers, facing subdued domestic demand, have increasingly relied on international buyers to maintain output.

Copper imports were also stronger-than-expected, Zhou Xiao’ou, an analyst with Zijin Tianfeng Futures Co, told Bloomberg.

Purchases of the metal and products reached 480,000 tons in June, the highest level this year. Russian shipments and cargoes from Chinese-owned mines in Africa may have replaced those rerouted to the US to beat the Trump administration’s tariff deadline, she said.

The most actively traded COMEX copper futures rose by 0.8% to $4.4115/lb. ($9,7053 per tonne) as of 10:40 a.m. ET. On the LME, copper settled 0.4% higher at $9,676 per tonne as of 5:51 p.m. London time.

Codelco shutdown adds supply risk

On the supply side, the market is still reacting to a major operational setback in Chile.

Codelco, the world’s largest copper producer, halted operations at its El Teniente mine after a deadly tunnel collapse on July 31 killed six workers and injured nine.

Underground mining activities were suspended, and processing plants were placed on care and maintenance after stockpiled ore ran out.

The shutdowns are expected to reduce output of the metal used in wiring, electronics and construction by about 30,000 metric tons a month, a quarter of Codelco’s production.

With 5,000 workers reassigned to inspect equipment, Codelco is now seeking regulatory approval to partially restart unaffected areas of the mine. The company has responded to multiple information requests from Chile’s mines regulator Sernageomin and the Labor Directorate.

“The situation is very delicate and an investigation is underway,” Michael Cuoco, head of metals at StoneX Financial Inc, told Bloomberg.

“As long as it’s ongoing, I find it extremely unlikely that the mine will be able to reopen.”

(With files from Bloomberg)