Copper price outlook: What next after the crash?

COMEX copper futures have been under selling pressure over the past three weeks after a shift in tariff dynamics caused a surprise plunge from its all-time high. In addition to the US tariffs, a decline in China’s refined copper output has also been weighing on the prices. 

Despite these pressures, the metal’s long-term fundamentals remain bullish. Indeed, BHP’s financial statement highlighted that copper demand was stronger than expected in the first half of CY25. Indeed, the top miner’s steady copper earnings helped offset the pressure from coal and iron ore.

Optimism over the rebalancing of the Chinese economy and the world’s intensified efforts to decarbonize, urbanize, and digitalize are set to heightened the red metal’s demand in the medium to long-term.

Copper price to find support in long-term fundamentals

The COMEX copper market has been under pressure since early August when President Trump unexpectedly exempted imports of refined copper from his 50% levies. The news caused a shift in supply dynamics as traders have bulked up amounts capable of satisfying demand for the remainder of the year.

Additionally, a decline in China’s refined copper output is also weighing on the asset’s prices. Data released by the National Bureau of Statistics showed that production in the second-largest economy dropped from a record high of 1.3 million tonnes in June to 1.27 million tonnes in July as the Beijing government focuses on industrial overcapacity.     

Nonetheless, the long-term demand outlook remains bullish amid optimism over the Chinese economy and global consumption. Indeed, it is copper’s resilient demand in the year’s first half that helped eased BHP’s pressures as iron ore prices dropped.

In its earnings report for the financial year that ended on 30th June, the top miner stated that it remains confident in the long-term fundamentals of copper as well as fertilizers and steel-making materials. This optimism is largely founded on the world’s efforts on decarbonization, urbanization, and global growth.

Digitalization is also set to drive copper demand in the medium to long term. BHP estimates that copper consumption in data centers will surge sixfold by 2050, from the current 500,000 tonnes a year to 3 million tonnes. The estimate equates to the annual production of the world’s top four copper mines.  

COMEX copper price technical analysis

COMEX copper price hovered around the support at $4.42 on Wednesday after dropping to its lowest level in over a week in the previous session. The red metal has been range-bound for about three weeks now after the 37% plunge from its all-time high. 

Despite the bullish outlook on a long-term basis, uncertainties over the US trade policy and global economy continue to weigh on the metal. The formation of the bearish death cross pattern on its daily price chart points to the continuation of the selling pressure in the short term. However, at an RSI of 32, it will likely record some recovery in the ensuing sessions. 

More specifically, the range between $4.42 and $4.50 will be worth watching in the immediate term. Further recovery will likely curb the gains at the resistance zone of $4.53. On the lower side, the bears’ success at breaking the current support will activate the lower one at $4.35.