Copper prices continued dropping in futures markets on November 3, while slightly rebounded in China's spot market due to rising spot premiums. Macro uncertainties and concerns on insufficient AI demand growth suppressed copper prices, while the tight fundamentals continued supporting a firm floor.
China's refined copper spot trading declined on November 3,with limited available supply and high futures backwardation structure dampening transactions. Downstream enterprises continued procuring based on rigid demand, showing limited acceptance of elevated prices and premiums. Scrap trading slightly increased as some holders actively sold when prices stayed high early in the day, but as prices dropped later, transactions declined and were constrained to rigid needs.
Trading in China's copper semis markets slightly recovered on November 3, as some end-users actively procured during falling prices. Although the pullback in copper prices stimulated some restocking demand, end-user consumption is expected to enter a seasonal slowdown, making a significant increase in overall demand difficult in the near term.
Over the long term, insufficient global copper mining capital expenditure and declining ore grades at aging mines will constrain supply elasticity over the next few years. Meanwhile, emerging industries such as AI data centers and new energy remain in an expansion cycle, likely continuing to drive growth in demand for power grids, energy storage, and supporting infrastructure. The copper market's fundamentals are therefore likely to remain strong in the long run.
