Here’s why copper price is soaring despite China property market jitters

Copper price has held steady above the crucial zone of $4.7550 as tight supply and surge in demand deepens the supply/demand imbalance. Notably, a weaker US dollar has further boosted prices. It has made the red metal less expensive at a time when US buyers are rushing to secure supply ahead of possible tariffs.

Even so, the persistent Chinese property market crisis has been weighing on copper price. Recent data showed a drop in new and existing home prices as developers use this strategy to boost sales. While the decline in property activities is lesser than in 2024, the prior stimulus hype appears to be waning.

China’s property market crisis weighs on copper prices

The stimulus measures enacted by the Chinese federal government appear to be insufficient in dealing with the ongoing real estate crisis with the latest data justifying the administration’s concerns. 

Earlier in the week, data from the National Bureau of Statistics indicated that new-home prices in 70 of the country’s cities dropped by 0.22% from April’s level when it had declined by 0.12%. Notably, this is the highest drop in 7 months. At the same time, the value of used homes dropped by 0.5%; the sharpest decline in 8 months. The data further showed that real estate investment was down by 10.7% in the first 5 months of 2025.

China is the leading consumer of copper. With an array of uses within the construction, electrical, and industrial subsectors, the health of China’s property market impacts the red metal’s demand. 

In Q1’25, copper price rallied to an all-time high of $5.37 per pound in late March. One of the key bullish factors that fueled this uptrend was Beijing’s stimulus measures enacted in September 2024. Over the past three months, COMEX copper price has been down by about 10% as the impact of the support measures wanes. 

Even so, the drop in property activities observed in 2025 appears to be lesser than in the previous year. While demand has weakened, the figures are also as a result of existing developments lowering prices to boost sales. Besides, the Chinese government’s commitment to coordinate existing and new fiscal policies is set to support copper prices. 

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Heightened supply/demand imbalance steadies copper price above crucial zone

Electric vehicles (EVs), renewable energy, and digital infrastructure continue to support copper demand, which is expected to grow by 70% by 2050 to 50 million tonnes according to the mining major, BHP. 

At the same time, there is a growing need to expand mining activities as mines age and major projects strive to meet their timelines. As highlighted recently in IEA’s Global Critical Minerals Outlook of 2025, huge investments will need to be pumped into mining operations to satisfy this level of demand. 

Besides, in the near term, the weaker US dollar has made copper less expensive for buyers holding foreign currencies. This factor, coupled with the probable tariffs on the red metal, has US buyers securing their supply. 

Copper price technical analysis

Copper price chart | Source: TradingView

About two weeks ago, copper price rallied to a two-month high amid concerns over tight supply and a weaker US dollar. While it has since pulled back, it has held steady above the crucial support zone of $4.7550, which is along the medium-term 50-day EMA.

Indeed, in its current consolidation mode, that support zone is worth watching. On the upside, I expect copper price to find resistance at $4.9445 as the market weighs on the geopolitical conflicts and the metal’s supply/demand dynamics. 

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