The Sino-US trade negotiations have made progress, and copper prices are expected to break through historical highs.

With the comprehensive agreement between China and the United States to alleviate trade tensions, a major risk to global economic growth has been released, and copper prices are expected to hit historical highs as a result. Last weekend, the London Metal Exchange (LME) copper price closed at a mere 1.3% difference from its historical peak. This Monday, market sentiment has already shown positive signals in advance: New York copper futures prices rose by as much as 2.4%, with oil prices and the US stock market also rising in sync. As of the time of writing, the New York Mercantile Exchange (Comex) copper price rose by 1.45%, while the London Metal Exchange (LME) copper price rose by 0.75%, reaching $11,027 per ton. Representatives from the US and China concluded their talks last Sunday, seemingly laying the groundwork for the two country's presidents to finalize an agreement later this week. US Treasury Secretary Steve Mnuchin stated that the 100% tariffs threatened by Trump previously are "no longer on the table," and China will also suspend its plans to expand the one-year export restrictions on rare earths. In May 2024, copper prices reached a historical high of $11,104.5 per ton; earlier this month, copper prices once again reached the $11,000 mark. Subsequently, due to the hardline stances taken by both China and the US on the eve of the trade negotiations, copper prices have been volatile. Since the beginning of the year, the LME copper prices have risen by 25%, mainly benefiting from a series of supply disruptions in major copper-producing countries. In September, there was a lethal accident at the large Grasberg mine in Indonesia owned by Freeport-McMoran Copper & Gold Inc. (FCX.US), which subsequently lowered its copper sales forecasts. Additionally, the Kamoa-Kakula mine owned by Ivanhoe Mines Ltd. in the Democratic Republic of Congo also encountered significant production setbacks. The depreciation of the US dollar this year further provided upward momentum for copper prices. As commodities are priced in US dollars, a weaker dollar makes them more attractive to investors. Since January, the US dollar index has fallen by more than 7%, driven by investors' expectations of further interest rate cuts by the Federal Reserve. The trend in copper prices also reflects the overall optimistic sentiment in the market for energy transition. The world's largest mining company, BHP Group Ltd Sponsored American Depositary Receipt Repr 2 Shs (BHP.US), expects global demand for copper to increase by around 70% by 2050, and has identified copper as a key growth opportunity to be focused on.