TL;DR: Copper prices rebound, nearing record highs as Chinese inventory depletion and pre‑holiday buying offset earlier tariff‑driven sell‑off.
The Details
- LME three‑month copper up 0.8% to $14,783/ton, $92 below its Sept 10 record; COMEX Dec copper at $6.871/lb, within 2 cents of its record.
- The rally follows a two‑week sell‑off triggered by a Reuters report that a White House copper tariff plan stalled, knocking >5 % off U.S. prices.
- Physical market tightening in China is the primary driver: Shanghai cathode stocks fell to 43,900 t (lowest since 2023), SHFE warehouse inventories down ~70 % since early June, and imports are being consumed directly by fabricators.
- Premiums in Shanghai widened to 1,375 yuan/ton over futures; London cash copper flipped from an $86 discount to a $62 premium.
- Seasonal factors – pre‑Mid‑Autumn and National Day restocking and upcoming refinery maintenance – are supporting demand, while a firmer dollar is being offset.
Watch For
- Upcoming Chinese holidays (Mid‑Autumn 2024, National Day Oct 1‑7) and refinery maintenance schedules that could further constrain supply.
- Any policy shift on the U.S. copper tariff that might re‑introduce price pressure.
- Dollar index movements; a stronger dollar could temper copper’s rally despite tight physical markets.
Analyzed by FNXT Experts