1. Trend Analysis
As shown in the chart above, copper prices rose before falling this week. By the end of the week, spot copper was quoted at 85,103.33 yuan/ton, down 0.3% from 84,850 yuan/ton at the start of the week, up 14.93% from the beginning of the year, and up 7.77% year-on-year.
Copper weekly rise and fall chart
On the macroeconomic front, the probability of a 25 basis point Fed rate cut in October reached 96.3%, with expectations for a December rate cut also rising. Expectations of easing have weakened the dollar’s appeal, driving capital into riskier assets and gold. The White House announced that over 10,000 federal employees may be laid off during the government shutdown, and Trump is pressuring Democrats to support a temporary funding bill, threatening targeted layoffs if they fail.
Supply side: In the first half of 2025, the output of major global copper companies only increased by 1.28% year-on-year, falling short of expectations. The Grasberg mine in Indonesia’s Freeport was shut down due to force majeure, resulting in a sharp drop of 200,000 tons in production in the fourth quarter (accounting for 0.9% of the world’s total), and another 270,000 tons (1.2%) in 2026; Teck Resources lowered its production guidance for two major copper mines, with the production forecast for Chile’s Quebrada Blanca copper mine reduced from 210,000-230,000 tons to 170,000-190,000 tons, and that for Canada’s Highland Valley copper mine reduced from 135,000-150,000 tons to 120,000-130,000 tons.
On the demand side: From January to August, real estate development investment fell by 12.9% (residential down 11.9%), construction area fell by 9.3% (residential down 9.6%), new construction starts fell by 19.5% (residential down 18.3%), and completions fell by 17.0% (residential down 18.5%). Area sold fell by 4.7% (residential), and sales fell by 7.3% (residential down 7.0%). From October 1 to 12, new energy passenger vehicle retail sales reached 367,000 units (down 1% year-on-year, up 1% month-on-month), bringing the cumulative total to 9.236 million units, a 23% increase. Wholesale sales reached 328,000 units (up 1% year-on-year, down 11% month-on-month), bringing the cumulative total to 10.775 million units, a 31% increase. High copper prices are dampening downstream purchasing, putting the manufacturing industry, particularly wire and cable companies, under the dual pressures of weak consumption and shrinking profits. According to traders, purchasing demand from Chinese wire manufacturers has slowed significantly since the end of September, with the Yangshan copper premium plummeting by over 20% from the end of September, confirming a cooling in domestic demand.
In summary: Rising expectations for rate cuts have weakened the US dollar, boosting metals. However, the ongoing US government budget impasse and escalating US-China tariff confrontation have shifted market sentiment toward caution. Given strong supply and weak demand, copper prices are expected to remain range-bound.
Post time: Oct-20-2025