Copper Outlook Dims as China’s Economic Engine Falters

Goldman Sachs has scaled back its copper price forecast for 2025 by a third, pointing to a protracted demand slowdown in China that continues to unsettle global commodity markets.

The investment bank now expects copper to average $10,100 per metric ton next year—down sharply from a prior projection of $15,000. The bank’s earlier forecast, released just four months ago, anticipated record highs driven by surging demand tied to electrification and infrastructure. But cracks in that thesis have widened.

In a note to clients, Goldman analysts said the rally has been “delayed” as consumption in China, the world’s largest buyer of copper, has faltered. A deeper-than-expected contraction in China’s property sector, which consumes large volumes of base metals, has compounded the weakness.

“The depletion of global copper inventories—and any associated price rally—is likely to come much later than we previously expected,” analysts wrote. The note, authored by Samantha Dart and Daan Struyven, reflects a shift in sentiment from earlier optimism expressed by Jeffrey Currie and Nicholas Snowdon, who had penned the earlier bullish call.

China’s struggles are proving more persistent than many commodity desks had priced in. Despite Beijing’s efforts to revive domestic demand, the country’s housing market remains under pressure, while manufacturing activity continues to oscillate between marginal growth and contraction. Sluggish exports, weighed down by global macro uncertainty, have further dampened industrial output.

Data from Shanghai Futures Exchange inventories show copper stockpiles have risen steadily in recent months, underscoring the mismatch between supply and consumption.

The forecast downgrade has broader implications. Major miners, many of whom have staked growth plans on robust long-term copper demand, are now navigating a more cautious environment. In July, BHP and Lundin Mining announced a C$4.1 billion all-cash deal to acquire Filo Corp., a copper exploration company with assets straddling the Argentina-Chile border. The acquisition underscored the sector’s continued push to secure future supply, despite softening prices.

London-based Anglo American has also pursued restructuring initiatives aimed at highlighting undervalued assets such as its Quellaveco copper mine in Peru. Executives have maintained that long-term fundamentals remain intact, driven by the metal’s central role in electric wiring and renewable energy systems.

Still, the timeline appears to be stretching. Other institutions have echoed Goldman’s revised tone. Macquarie, in a recent update, noted that “strong supply and muted demand have pushed the market into surplus earlier than expected.” The firm sees the market remaining in oversupply through at least 2026, citing production ramp-ups and slower Chinese drawdowns.

Broader commodity pricing also reflects this cooling momentum. Goldman revised down its aluminum forecast to $2,540 per metric ton from $2,850. Iron ore and nickel continue to face headwinds amid abundant inventories and lukewarm steel demand.

“China’s commodity demand is proving softer than anticipated,” Goldman analysts wrote, noting that broader downside risks remain to the country’s economic outlook. Recent reports from the National Bureau of Statistics show that industrial production and retail sales have underperformed in successive quarters, despite central government stimulus efforts.

Online commodity tracker Trading Economics currently lists spot copper prices at just under $9,200 per ton, a level that has struggled to gain momentum in the absence of clearer demand signals from China.

Elsewhere in the metals complex, gold remains a bright spot. Goldman is holding its forecast of $2,700 per ounce for early 2025, citing supportive macro conditions, including anticipated rate cuts by the U.S. Federal Reserve. Strong central bank purchases and increased institutional interest in the West continue to provide a tailwind for bullion, in contrast to the more cyclical copper trade.