Analysis-New copper demand drivers from US, India as China juggernaut slows
By Pratima Desai
LONDON (Reuters) – Copper consumption in the United States and India is expected to emerge from China’s shadow over the next decade as demand growth in the world’s largest consumer of the industrial metal slows.
Beijing’s industrial and infrastructure expansion has helped fuel the rise in copper prices that has soared from $1,500 to more than $10,000 per metric ton 25 years ago.
But while China is predicted to remain the largest market for copper for the next decade and beyond, analysts predict other demand and price influences will increasingly come into play.
Changing regional policies, infrastructure cycles and geopolitical shifts will likely mean that producers, consumers, traders and investors will need to adapt to a market with many different factors.
“China will reduce copper consumption and stockpiling. We’re basically going back to old-fashioned copper drivers with replacement cycles outside of China,” said Panmure Liberum analyst Tom Price.
The impact is yet to be seen, but moves by the US and other countries to encourage domestic production also mean China’s export machinery and manufacturing activity is expected to slow, weighing on demand for refined copper, which is estimated at around 15 million tonnes this year.
Meanwhile, data centers needed to be supported artificial intelligence technology and improvements in power grid infrastructure mean that growth in copper demand outside China will be a driver of prices.
Predicting that Chinese demand will be 6% lower in 2031 than in 2026, Price said, “China has built its infrastructure, including the energy distribution network. Its activities will shift to a lower level to meet its needs.”
Price predicts that China will account for 52% of global primary copper consumption in 2031, at around 27 million tonnes, compared to 57% in 2026.
It also expects US copper demand to increase by nearly 50% to 2.2 million tonnes in 2031 compared to 2026, while copper demand for India will increase by more than 30% to over 1 million tonnes.
‘Pushback from COUNTRIES IN THE WEST IS INCREASING’
Analysts also expect US President Donald Trump to impose a 50% tax on copper pipes and cables to encourage domestic production.
The likely outcome for China would be the loss of an important market for copper pipe exports. Trade Data Monitor ranks the US as China’s fourth largest market for the product.
According to TDM data, 14.4 million tons of copper pipes and pipes were imported directly from China last year, and in the first seven months of this year, their total reached nearly eight million tons; This underscores the potential loss of a major market for Beijing.
