FX.co ★ Copper Slips on Demand Concerns

Copper futures dropped to approximately $5.87 per pound on Tuesday, retracting some of the gains recorded in the previous session. This pullback is attributed to indications of weakening demand from China, the world’s largest copper consumer. The Yangshan import premium, a pivotal measure of Chinese copper demand, has plummeted by 50% over the past month, reaching its lowest point since mid-2024. Analysts have cautioned that the unprecedented high prices of base metals are beginning to undermine demand by compressing corporate profit margins. Copper prices had recently soared to new record highs, fueled by optimism surrounding the global transition to renewable energy and concerns over supply constraints due to the potential imposition of US tariffs, which had tightened market conditions in London. However, prices have since declined following the US decision to delay tariffs on critical minerals and China's intensified measures to control high-frequency trading, a major influence in commodity markets.