A copper mine Photo: VCG

The global copper price has shown a robust upward trend since the beginning of April, with the prices exceeding 80,000 yuan ($11,039.81) per ton, a 14-year high, reflecting the recovery of the world's second largest economy.

Multiple factors including the suspension of some major copper mining and the US and UK sanctions on Russia that tightened market supplies have ignited the price hikes. However, strong demand for copper across China's booming manufacturing sectors such as new-energy vehicle (NEV) has also been an important driver for growth, experts noted.

Expectations of increased demand brought about by economic recovery will continue to support copper prices for the rest of the year, experts added.

According to data from the Yangtze River Non-ferrous Metal on Monday, the spot price of Yangtze No. 1 copper was reported at 80,600 yuan per ton on average, an increase of 510 yuan per ton from the previous trading day.

Copper prices have maintained a recent upward trend with several major futures contract marking new records.

For example, recently, the main copper futures contract on the London Metal Exchange touched $10,000 per ton during trading hours, marking the first time since April 2022, according to media reports.

Meanwhile, in the Chinese market, the main copper futures contract on the Shanghai Futures Exchange broke through the 81,000-yuan mark, hitting a new high since 2006.

There are combined reasons that driving up the copper prices.

One of the reasons for the prices rise is the supply-side issues in the copper mining sector, experts said.

Over the past period, disruptions in copper mining supply have persisted due to the suspension or reduction of production in some large copper mines worldwide, exacerbating concerns about tight copper supply in the market, Yu Shaoxue, copper analyst with the Shanghai Metals Market SMM, a metals information provider, told the Global Times on Monday.

Moreover, several international events have heightened market sentiment. For example, on April 12, the US and the UK announced new trade restrictions on Russia, targeting aluminum, copper, and nickel produced by Russia, sparking market concerns. 

In addition to the issues on the supply side, the strong copper price reflects the good market expectations for consumption recovery in major world economies, particularly in China.

The soaring price echoes a relatively optimistic market expectation for economic recovery, especially in major countries like China that contribute significantly to global economic growth, Li Chang'an, a professor at the Academy of China Open Economy Studies of the University of International Business and Economics, told the Global Times on Monday.

The high copper price reflects the recovery of the manufacturing sector. According to the data released by China's National Bureau of Statistics (NBS) on Saturday, in the first quarter, the total profits of industrial enterprises above a designated size reached 1.505 trillion yuan, a year-on-year increase of 4.3 percent, and the operating income totaled 30.96 trillion yuan, a 2.3-percent growth year-on-year.

Copper is a crucial raw material in manufacturing, widely used across various industries, so the recovery of the manufacturing sector itself will also drive the rise in copper prices, Li said.

Copper is often used in areas such as batteries, motors, and charging piles within the NEV sector, which has experienced significant growth in recent years amid global demand for green transformation.

Looking ahead, the price will likely to maintain its strong rebound, as market expectations for a stronger copper continues against the backdrop of the foreseeable good demand for new-energy products including NEVs and solar panels, according to Yu.

The market expectation for a positive power grid performance in the second half of the year will also play the driver, the expert said, indicating the possible high demand for electricity use.