Copper tops $9,000 for first time since June

Markets hope the reopening of China will revive demand for the semi-precious metal in 2023

Copper is back above $9,000 per tonne for the first time since June as traders anticipate a bounce in Chinese demand following the country’s decision to reopen its borders. 

On Wednesday, the metal rose 1.1% to $9,013.50 on the London Metal Exchange (LME), posting its fifth consecutive daily gain.

Copper cable

The price of copper is at its highest level since summer 2022. (Denis Charlet / AFP via Getty Images / Getty Images)

Copper has risen roughly 10% since China started reopening on Sunday, putting an end to three-years of zero-COVID policy despite the U.S. and other countries requiring Chinese travelers to have a negative test before departing the country.

In an interview with FOX Business, Edward Moya, senior market analyst for OANDA in New York said, "China is the world's top copper consumer, and their economy appears ready to bounce back."

However, Capital Economics analyst Caroline Bain cautioned that because Chinese industry had been relatively resilient through zero-COVID, demand for metals was unlikely to rebound as strongly as demand for energy, adding that the copper market would be well supplied in 2023 and prices may have risen too far too fast.

Heavy equipment at a copper mine

Heavy machinery is seen at Frontier copper mine in Fungurume, southern Democratic Republic of Congo May 25, 2010. (Reuters/Katrina Manson / Reuters Photos)

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Moya pointed to interest rates as another factor to consider. "A weaker U.S. dollar outlook could unfold in 2023 should the Fed end rate hikes this quarter, providing additional support for copper," he said.

Already up roughly 8% year-to-date, the price of metals like copper has been helped by a weakened U.S. dollar. The greenback has sunk to its lowest level since the summer of 2022, making dollar-priced metals more affordable for buyers with other currencies.

Copper fell sharply in mid-2022 as the global economy slowed, interest rates rose and the dollar strengthened.

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Over the last year, other metals like gold and silver have also thrived amid ongoing inflationary pressures and looming recession, rising roughly 3.05% and 2.93% respectively, as all three major U.S. benchmarks registered losses and stocks suffered their worst year since 2008. 

Copper miners include Freeport-McMoRan, BHP Billiton and Glencore.

Ticker Security Last Change Change %
FCX FREEPORT-MCMORAN INC. 49.56 +0.20 +0.39%
BHP BHP GROUP LTD. 56.60 -0.62 -1.08%
GLNCY GLENCORE PLC 11.46 -0.22 -1.88%

Reuters contributed to this report.