Copper Prices Surge Amid Record Rally Despite China Demand Slump

Copper prices have reached new highs in recent months, but despite this, demand from China has fallen. According to Morningstar Australia's Mining 2026 Q2 Industry Pulse report, the copper price has increased by around 10% compared to last quarter, reaching approximately $6.50 per pound.

This rise in price is largely due to optimism over artificial intelligence and energy transition demand, as well as US tariff-related trade distortions and near-term supply issues at various mines. However, China's copper imports have been falling, which could potentially offset the rising demand from other sources.

Morningstar Australia predicts that China's demand will moderate as it transitions to a more consumption-focused economy, but mined supply is expected to increase in the long term due to new technologies and rising recycled/scrap supply. This raises questions about the valuations of copper miners, which investors should consider.