The pace of copper's rebound from the price lows it hit in March came as a surprise, according to analysts, who said Chinese demand was the main driver of the rally.

Prices of copper, a key industrial metal, slumped earlier this year amid global action to curb the coronavirus pandemic. In early January, copper traded for more than US$6,000 per tonne, but by mid-March, the price had fallen below US$5,000 per tonne and remained at that level until early April as investors fretted over the economic impact of the virus and policy responses to the pandemic.

But since late April, the price of copper has regained some of the ground it lost this year, trading for as much as US$5,885 per tonne June 10.

"It's fair to say I've been surprised by the strength of the copper recovery," BMO Capital Markets analyst Colin Hamilton told S&P Global Market Intelligence. "From a fundamental side, the raw material market is tight ... however, in terms of end demand, China is the only game in town at the moment."

Hamilton said a strong import arbitrage is helping support the rally alongside scant inventories in bonded warehouses, which he said were the lowest in a decade.

Paradigm Capital analyst David Davidson told Market Intelligence that the rebound in copper unfolded more quickly than he expected. On a per-pound basis, the price has traded about 15 U.S. cents higher than he forecast for the second quarter and was already higher than his third-quarter expectations, Davidson said.

But whether copper can maintain the momentum in the coming months remains a tough call given economic uncertainty hanging over a broader rebound. Hamilton expects the rally to take a "summer pause" with another leg up hinging on global economic recovery beyond China.

"I think there is a strong chance of this happening, but not quite yet," Hamilton said.

Davidson, as other analysts, also pointed to the possibility of supply tightening in South America, a key copper-producing region, should a surge in COVID-19 there lead to disruption as other copper consuming countries, China especially but also the U.S., continue to reboot their economies.

"So depending on how things evolve over the next couple of months, we may find we have underestimated for the second half of the year as well," Davidson said.

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A union in Chile, the top copper-producing country, recently warned that increasing COVID-19 cases were "alarming," with workers reportedly considering downing tools to self-isolate.

CIBC Equity Research analyst Oscar Cabrera underscored the potential for demand recovery amid possible supply disruption while also sounding a note of caution.

The 10 largest producing countries for copper, zinc, iron and metallurgical coal, representing an average 88% of global supply, have had an increase of about 30% in COVID-19 cases over the last two weeks, Cabrera said in a June 7 research note. "Escalation of cases in Brazil and Chile represents the main risk to [iron] and [copper] supply chains, respectively," Cabrera added.

Overall, Market Intelligence expects the copper market to be in surplus in 2020; analyst Thomas Rutland recently pegged it at 182,000 tonnes followed by a 63,000-tonne deficit in 2021. As for the price of copper, Rutland has maintained a forecast of US$5,700 per tonne for 2020 in recent months.