Copper prices in Shanghai witnessed a significant uptick on Monday, riding high on unexpectedly strong industrial production data from China that signaled renewed vigor in the world's second-largest economy.
The most-traded July copper contract on the Shanghai Futures Exchange (SHFE) climbed 0.7% to 81,230 yuan ($11,207) per metric ton, reflecting growing optimism among traders and investors about China's industrial recovery.
Industrial Revival Fuels Metals Demand
China's industrial output surged 6.7% year-on-year in April, significantly outpacing the 5.5% growth forecast by analysts. This robust performance in the manufacturing sector, a key consumer of industrial metals, provided the fundamental support for copper's upward movement.
"The stronger-than-expected industrial data confirms that China's factory activity is gaining momentum," noted a Shanghai-based metals trader. "This directly translates to increased demand for copper, which is essential for construction, electronics, and renewable energy infrastructure."
Supply Concerns Add to Bullish Sentiment
Beyond demand factors, supply-side issues continued to support higher prices. Ongoing production cuts at smelters due to raw material shortages have tightened the physical market, creating a perfect storm for price appreciation.
The positive sentiment extended beyond domestic markets, with three-month copper on the London Metal Exchange rising 0.5% to $10,276.50 per ton, approaching the two-year peak of $10,267.50 reached in the previous session.
Other Metals Follow Copper's Lead
The bullish trend wasn't limited to copper alone. Other base metals also registered gains:
- SHFE aluminum advanced 0.8% to 20,875 yuan per ton
- Zinc increased 0.5% to 24,690 yuan
- Lead edged up 0.3% to 18,755 yuan
- Tin jumped 1.8% to 279,600 yuan
- Nickel gained 0.8% to 148,220 yuan
Market analysts suggest that the current rally reflects both short-term supply constraints and longer-term optimism about global industrial recovery, particularly driven by China's manufacturing resurgence and the global transition to green energy, where copper plays a critical role.
