The price of copper, a key barometer for the global economy, is set to move higher in 2020 with capital spending for new production depressed and inventories tapped out as U.S.-China trade tensions ease.

The U.S-China trade war limited mining activity and kept manufacturer inventories lean. Warehouses tracked by the three international exchanges, the last resort for supply, have shrunk by about 37% since July to just shy of 300,000 tons as of Friday, equivalent to just 1.2% of global consumption. Mine production fell 0.4% last year from 2018.

“Europe and developed Asia have been destocking pretty aggressively over the past six months or so.  You can’t do that forever.” – Colin Hamilton, BMO Capital Markets analyst

Copper’s tight supply situation was masked by the trade tensions.

German manufacturing remains burdened by issues ranging from the U.S.-China trade conflict and Brexit uncertainty to its own struggles to manage the auto sector’s shift to electric vehicles. But its latest industrial output data offered a cautious sign that Europe’s economy may be near the bottom of its manufacturing slump.

In Asia, which accounts for more than 60% of copper demand, manufacturing finished 2019 with a modestly brighter outlook, with fewer economies signaling contraction at factories.