{"id":17519,"date":"2025-05-07T07:54:19","date_gmt":"2025-05-07T07:54:19","guid":{"rendered":"https:\/\/businesstriumphs.com\/index.php\/2025\/05\/07\/copper-crunch-chinas-stockpiles-depleting-us-demand-rising\/"},"modified":"2025-05-07T07:54:19","modified_gmt":"2025-05-07T07:54:19","slug":"copper-crunch-chinas-stockpiles-depleting-us-demand-rising","status":"publish","type":"post","link":"https:\/\/businesstriumphs.com\/index.php\/2025\/05\/07\/copper-crunch-chinas-stockpiles-depleting-us-demand-rising\/","title":{"rendered":"Copper Crunch: China\u2019s Stockpiles Depleting, US Demand Rising"},"content":{"rendered":"<\/p>\n
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Copper prices are being pushed skyward as <\/strong>China\u2019s stockpiles sit on the verge of depletion and as US demand for the red metal surges, <\/strong>fueled by looming trade restrictions under the Trump administration. <\/strong><\/p>\n

According to Mercuria, the market is undergoing \u201cone of the greatest tightening shocks\u201d in its history. <\/p>\n

\u201cAt the current pace of draws, those Chinese inventories could deplete (to zero) by the middle of June,\u201d Nicholas Snowdon, head of metals and mining research at the commodities trading house, told the Financial Times.<\/p>\n<\/div>\n

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\u201cBeijing had a razor-thin inventory buffer\u201d to meet its soaring domestic demand, he added.<\/p>\n

Copper inventories held in Chinese warehouses fell by a record 55,000 metric tons last week alone, sinking to just 116,800 metric tons. The sudden drawdown has placed further stress on a market that is already being strained by geopolitical tensions and a shift in long-term demand driven by clean energy initiatives and electrification.<\/p>\n

The copper squeeze is being exacerbated by US buyers rushing to secure supply ahead of potential new tariffs.<\/p>\n

US President Donald Trump has signaled that his administration is investigating \u201cdumping and state-sponsored overproduction\u201d of copper, echoing the rationale used for the imposition of 25 percent levies on steel and aluminum.<\/p>\n

Copper futures prices on the Comex in New York have soared, rising 16.35 percent year-to-date to trade for US$4.69 per pound. The rally has been further buoyed by signs that China\u2019s Ministry of Commerce is open to trade talks with the US \u2014 it has reportedly \u201ctaken note\u201d of Washington\u2019s signals and is evaluating the possibility of engagement.<\/p>\n

As a result, inventories in Comex warehouses have surged to their highest levels since 2018.<\/p>\n

The copper crunch is not confined to refined metal. <\/p>\n

Analysts warn that Chinese access to copper scrap \u2014 a vital feedstock for its smelting industry \u2014 is also under threat from retaliatory trade measures and possible US export controls.<\/p>\n

China relies heavily on imported scrap, and the US remains a key supplier. In 2024, the US exported 960,000 metric tons of copper scrap, nearly half of which went to China, according to data from Fastmarkets.<\/p>\n

This year, exports are already trending lower: 142,000 metric tons were shipped in January and February, down from 149,000 metric tons in the same period last year. If the US imposes a ban on scrap exports or China imposes retaliatory import duties, the shortage in Asia\u2019s largest economy could become even more acute.<\/p>\n

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Copper\u2019s strategic role in the energy transition <\/h3>\n

Beyond short-term trade politics, copper is at the heart of a deeper structural transformation. <\/p>\n

As the global economy pivots toward electrification and decarbonization, demand for the base metal is set to soar \u2014 despite advances in material efficiency and substitution.<\/p>\n

During a recent webinar, Michael J. Finch, head of strategic initiatives at commodities price and data firm Benchmark Mineral Intelligence, noted that the accelerating deployment of electric vehicles (EVs), EV charging infrastructure and renewable energy sources is rapidly driving up copper intensity across energy systems.<\/p>\n

\u201cWhat \u2026 we can\u2019t forget is, what are the requirements on the grid network? What are the requirements on power generation because of EVs, because of the charging infrastructure?\u201d Finch said. He emphasized to attendees that while copper usage per EV has declined from around 100 kilograms in 2015 to about 68 to 70 kilograms today due to design optimizations and thrifting, total copper demand from the EV sector is still expected to rise sharply.<\/p>\n

\u201cWe\u2019re still looking at a market here \u2026 (of) over 5 million tonnes by 2040,\u201d he said. <\/p>\n

\u201cThat\u2019s going to need a lot of charging infrastructure. That\u2019s going to need a lot of grid upgrades. That\u2019s going to need a lot of renewable power to be put in place,\u2019 Finch added. <\/p>\n

The overlapping dynamics of geopolitical uncertainty, rising protectionism and shifting energy priorities have created a volatile cocktail that could reshape global copper trade flows.<\/p>\n

Efforts are underway in the US to take advantage of this shift. European copper producer Aurubis is investing 740 million euros in a new recycling facility in Richmond, Georgia, aimed at bolstering domestic supply. The plant, which is expected to be operational by the end of the fiscal year, will rely primarily on scrap sourced within the US.<\/p>\n

Meanwhile, analysts are watching closely to see if the US and China can defuse trade tensions before they further destabilize a market that is already stretched thin.<\/p>\n<\/div>\n

Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.<\/strong><\/p>\n<\/div>\n

Keep reading\u2026<\/span>Show less<\/span><\/div>\n<\/p>\n
This post appeared first on investingnews.com<\/div>\n","protected":false},"excerpt":{"rendered":"

Copper prices are being pushed skyward as China\u2019s stockpiles sit on the verge of depletion and as US demand for the red metal surges, fueled by looming trade restrictions under the Trump administration. According to Mercuria, the market is undergoing \u201cone of the greatest tightening shocks\u201d in its history. \u201cAt the current pace of draws, […]<\/p>\n","protected":false},"author":0,"featured_media":17520,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"class_list":["post-17519","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investing"],"_links":{"self":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/17519","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/comments?post=17519"}],"version-history":[{"count":0,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/17519\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media\/17520"}],"wp:attachment":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media?parent=17519"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/categories?post=17519"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/tags?post=17519"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}