Key Takeaways
- Copper prices fell by 0.1% to $14,385 a metric ton.
- LME registered warehouse inventories reached a two-month high of 147,450 tons.
- Strikes at major Chilean mines have ended, easing supply concerns.
Copper prices experienced a slight decline on Monday, dropping by 0.1% to $14,385 a metric ton by 10:16 GMT. This decrease followed an increase in London Metal Exchange (LME) stocks, which reached a two-month high of 147,450 tons.
The rise in LME stocks was attributed to 8,225 tons of copper entering US warehouses, marking a significant shift from recent months. Previously, traders had been diverting shipments to the US to avoid potential tariffs on refined copper imports, which had contributed to a record high price of $14,875 a ton on September 10.
Daniel Ghali, head of metals research at Deutsche Bank, highlighted that the threat of US tariffs is part of a broader strategic shift driven by national security concerns over critical minerals supply chains. He noted that even if tariff concerns were resolved, transportation costs and market friction would continue to discourage large-scale exports from the US.
In the top metals consumer, China, economic growth showed signs of recovery in the third quarter, bouncing off three-year lows. However, the country's property market remained in a downturn, with new home prices continuing to fall, extending a more than three-year slump.
On the supply side, workers at Antofagasta’s Centinela mine in Chile ended a strike that began on October 7, marking a significant development in the market. This resolution helped to ease supply concerns that had previously affected copper prices.
Other metals in the LME also showed mixed performance. Aluminium prices remained steady at $3,000 a ton, while zinc prices increased by 1.1% to $3,730.50 a ton. Lead prices rose by 0.2% to $1,891.50, tin gained 0.4% to $50,330, and nickel prices increased by 0.9% to $15,495.
China's primary aluminium production hit a record quarterly high over July to September, with smelters maintaining high operating rates despite a government-imposed capacity ceiling. This production surge contributed to the overall market dynamics, influencing the prices of various metals.
