Copper Gains on Tightening Supply

Copper futures surged to a two-week high near $6.50 per pound on Monday, as ongoing supply constraints continued to tighten market conditions, according to a report from Trading Economics. Analysts pointed to shortages of copper concentrate and scrap copper in top consumer China as the primary driver of market spreads and treatment charges rising.

Traders remained cautious about the possibility of new US tariffs on the metal, which has led to a diversion of copper shipments into the country. The bullish sentiment was further bolstered by copper's favorable long-term demand outlook, driven by the global push towards clean energy and the rapid expansion of artificial intelligence data centers.

However, private data revealed that China's manufacturing activity had slowed to a four-month low in July, with output and new orders expanding at a slower pace. This dampened the demand outlook, and the Politburo indicated last week its intention to continue relying on existing policy measures rather than implementing broad-based stimulus.