Key Takeaways
- Copper prices increased by 0.96% to $14,614.5 per metric ton.
- Supply fears from key mines, including Chile’s Centinela and BHP’s Escondida, drove the rally.
- Chinese buyers are expected to restock after the National Day holiday.
Copper prices gained on Thursday, rising by 0.96% to $14,614.5 per metric ton by 0300 GMT, according to the London Metal Exchange (LME).
The rally was fueled by expectations that Chinese buyers would restock following the week-long National Day holiday, amid low stocks and mounting supply risks.
CRU principal analyst Craig Lang stated that the restocking was expected due to low inventories and increasing supply concerns.
Supply disruptions intensified after workers at Chile’s Centinela copper mine launched a strike on Wednesday, following the breakdown of talks between two unions and Antofagasta Minerals.
Last week, supervisors at BHP’s Escondida copper mine, the world’s largest, rejected a collective contract offer, potentially paving the way for a strike there as well.
These supply disruptions have added to concerns over tightening availability outside the US, where traders have been drawing copper from overseas warehouses ahead of a potential tariff on refined copper imports.
The LME cash-to-three-month copper spread widened to an $89.06 backwardation on Wednesday, signaling concerns about near-term availability.
On the Shanghai Futures Exchange (SHFE), the most-traded copper contract rose 1.41% to 111,120 yuan ($16,577.40) per ton.
The price of zinc on the LME also saw a 1.22% increase, driven by a burst of trading in the morning, with the cash-to-three-month spread at $47.71 in backwardation on Tuesday.
Aluminium prices on the LME climbed 0.51%, regaining some of the previous day’s losses, while SHFE prices fell 1.17% due to a recovery in Middle Eastern production and rising shipments from Indonesia.
Other LME metals showed mixed performance, with lead adding 0.18%, nickel dipping 0.06%, and tin gaining 0.48%.
