The International Copper Study Group (ICSG) said last Friday that the global copper supply is expected to be in deficit this year due to improving demand in China.
ICSG expects a supply deficit of about 114,000 mt in 2023, compared with a surplus of about 155,000 mt forecast in October last year, largely due to an expected improvement in consumption in China.
However, “a surplus of around 298,000 mt is expected to emerge by 2024 due to increased supply.”
"The reopening of China, the recovery of the rest of the world which was constrained in 2022, and improving economic growth in 2024 are all expected to support usage growth in 2023 and 2024," the group said.
"Despite the challenging global economic outlook, manufacturing activity is expected to continue to rise.”
Copper on the London Metal Exchange (LME) steadied last Friday as China, the world's largest consumer of the metal, pledged to boost economic growth, but weak demand and signs of a global economic slowdown limited gains.
A sustained rise in copper prices is only likely if the economic outlook improves, Commerzbank analysts said in a note.