Raw materials: Copper, prices escalating due to supply challenges and economic stimuli in China.

market copper It has witnessed a remarkable recovery, reaching levels not seen in two and a half years, driven by a complex mix of economic and regulatory factors. The rise in the price of copper is partly due to emerging concerns about the global supply of the metal and expectations of new economic stimulus measures in China, one of the world's largest copper consumers.

China has recently shown signs of an economic slowdown, as evidenced by the latest foreign trade data indicating a significant contraction in exports and an unexpected decline in imports during March. These economic indicators have fueled speculation that the Chinese government may implement new stimulus policies to revive the economy. Investors view China's potential injection of economic stimulus as a potential catalyst for increased demand for copper, given its widespread use in the industrial and construction sectors.

At the same time, the copper market faces serious challenges on the supply side. China's major copper smelters may reportedly be subject to government regulations that would force them to cut production by up to 10% this year. In addition, satellite images have revealed an increase in offline smelter activities, further complicating the supply situation.

Added to this is the declining supply of copper ore, which has been exacerbated by operational problems in critical mines in major producing countries such as Panama and Chile. Incidents such as the closure of the Cobre mine in Panama and other unrest in Chile have placed additional pressure on already competitive processing and smelting markets, causing them to reduce refining rates to near-zero levels.

In this environment, the impact of a stronger US dollar, which typically poses downward pressure on dollar-denominated commodity prices, appears to be overshadowed by concerns about supply and stimulus expectations in China. This complex forecast suggests that copper prices could maintain their upward trend in the short to medium term, especially if supply conditions remain tight and Chinese economic stimulus is achieved effectively.

Copper weekly chart (clear uptrend)