MNI: China Copper Demand To Accelerate In 2025

China’s copper demand is expected to strengthen from last year’s 3.2% y/y growth as greater activity in new industries, such as electric vehicles (EV), more than offsets persistent declines in the property market and traditional sectors, local analysts told MNI.

Domestic usage should reach 15.4-15.8 million tonnes in 2025, reflecting a 3.5-4.0% y/y growth over 2024, said Xu Hongping, head of research at Chuangyuan Futures. New energy industry consumption, including EVs, wind and solar, is expected to rise to 28% of total demand from 18% in 2024, signaling a structural shift, Xu said. New energy vehicle appetite was expected to increase 28% y/y, while windfarm and solar-panel installations would require 1.7 million tonnes, up from 2024’s 1.5 million tonnes, she continued. 

“This change offsets the continued fall in new property construction starts, which fell 23% y/y during the first four months, reducing construction-related usage of 400,000 tonnes from 2024,” she noted. 

Although the pace of copper expansion may slow during the mid-year manufacturing off-season and peak electricity restriction period, appetite will pick up during autumn and winter, according to Gu Fengda, nonferrous metals chief analyst at Guoxin Futures, who saw demand up 3.5% this year overall. Power grid investment will be the most prominent driver of copper demand growth this year, with the State Grid Corporation of China’s planned outlay exceeding CNY550 billion, an 8% y/y increase, taking the power sector’s share of total consumption to 42% this year, up from 37% in 2024, Gu added.

Grid development across eastern regions, together with wind and solar mega-bases in the central and western provinces, will outweigh a drop in growth from traditional transport infrastructure and mechanical equipment to below 2% and 1% y/y, down from high single digits over the past years, he continued. 

PRICES

The main copper contract on the Shanghai Futures Exchange (SHFE), which has risen more than 5% since the start of January to CNY78,170 per metric tonne, was expected to fluctuate between CNY78,000–83,000 by the end of June, said Gu. “Prices will remain at high levels given supply disruptions in several producing countries, while tariff tensions have intensified cross-market arbitrage capital flows, increasing market volatility,” Gu noted.

Analysts told MNI in February that prices would likely tip about CNY80,000 sometime this year. (See MNI: Firm China Copper Demand To Support Prices)

Copper concentrate treatment costs (TCs) paid to smelters have also fallen to a historic low of -USD44 per tonne, indicating a severe shortage of supply amid recent disruptions in Chile and the Congo, Xu said. “Though domestic smelting capacity expansions have partially offset pressure,” Xu added. “Progress on TC talks between Chinese smelters and Antofagasta, a Chilean miner, could support prices going forwards, with first-round offers at -USD15 per tonne.” 

Short-term prices could find resistance at CNY79,000, but could rise as high as CNY82,000 later in the year, Xu concluded.