A coil of copper rod sits on the production line for copper flat wire at the Wellascent factory in Ganzhou, Jiangxi province, China August 14, 2025. REUTERS/Florence Lo/File Photo

(Reuters) -Copper smashed through its all-time high on Wednesday, spurred by fresh concerns over mine supply and hopes of a U.S.-China trade deal, but analysts questioned how much further the rally could run without a sustained pickup in demand.

Prices of copper, considered a bellwether for the global economy, have risen more than 27% so far this year, also helped by a weak dollar - which makes metals more affordable for holders of other currencies - and falling interest rates.

"The prospect of a trade deal between the U.S. and China has provided a fresh catalyst to copper's rally," said ING analyst Ewa Manthey, adding that the bank forecast a tighter copper market balance this year and in 2026, when - like many banks and brokers - ING envisages a deficit.

Miner and commodity trader Glencore on Wednesday followed rival Anglo American in reporting lower copper production in the first nine months of 2025 and cut its full-year guidance, adding to a long list of squeezes on mine output.

Benchmark copper on the London Metal Exchange rose as much as 1.5% to $11,200 per metric ton after topping its previous record high of $11,104.50, set in May 2024, earlier in the session. It was trading at $11,190.50 at 1645 GMT.

The International Copper Study Group said this month it expected a deficit of 150,000 tons in the refined copper market next year, against total consumption of 28.7 million tons.

But Panmure Liberum analyst Tom Price said the main drivers he sees behind copper's recent rally - easing trade tensions and an expected Federal Reserve rate cut - will be largely priced in by Thursday.

"Then I think some (investors) will exit on lack of price drivers and the reality that demand for copper hasn't really changed that much," Price said. Panmure Liberum sees a small surplus of 80,000 tons of copper next year.

Speculative bets on commodities tend to cool after becoming too rampant, WisdomTree commodity strategist Nitesh Shah said. "That could be another aspect here as well. We have certainly seen that in the precious markets."

Gold, for example, has gained 52% year-to-date, but prices have retreated around 8.5% from a record high of $4,381.21 an ounce on October 20.

Copper prices are expected to stay in a range of $10,000-$11,000 in 2026/2027 due to a market surplus, although the long-term outlook remains positive, Goldman Sachs said in a note earlier this month.

(Reporting by Tom Daly; editing by Pratima Desai and Kirsten Donovan)