Copper Sees Pressure From Soft Chinese Demand Amid Supply Deficit Fears

Short-Term Demand Anxiety

The metal's recent dip is primarily attributed to weaker-than-expected economic figures from China, which continues to be the largest consumer. Subdued manufacturing and construction activity are raising doubts about immediate consumption, pushing traders to reduce their bullish positions.

Structural Deficit and Supply Risk

Despite near-term softness, the supply-side risks are immense. Multiple supply disruptions at major mines are expected to push the market into a chronic deficit by 2026. This long-term constraint provides a firm floor for prices, as industrial consumers cannot afford to let prices fall too low and risk failing to secure material.

Green Infrastructure Pull

Copper is a vital component in the global clean energy transition, projected to drive more than 60% of copper demand growth through 2030. Investments in new power grids, electric vehicle infrastructure, and data centers are robust, ensuring that the fundamental demand base remains strong, making any weakness a tactical buying opportunity.