Copper experienced a notable increase of 2.98% yesterday, closing at Rs 945.75, driven by supply concerns following Freeport-McMoran’s declaration of force majeure at its Grasberg mine in Indonesia. The miner cautioned that output in 2026 may be reduced by 35% compared to previous estimates due to a landslide that has interrupted operations. On the inventory front, U.S. Comex copper stocks have surged to 318,285 short tons, reflecting a 241% increase this year, while Shanghai Futures Exchange inventories have risen by 12.5% to reach their highest level since June at 105,814 tons. LME stocks have risen by 56% in the last three months, indicating sufficient short-term availability even in the face of wider supply risks.

China’s copper demand continues to be a significant factor, as consumers are replenishing their stocks in anticipation of the Golden Week holiday. Citi anticipates that refined copper consumption will increase by 2.9% in 2026, reaching 27.5 million tons, thereby shifting the global balance into a deficit of 308,000 tons in contrast to this year’s surplus. In early September, China experienced a production decline of 5%, resulting in a reduction of approximately 500,000 tons from the market. This decrease partially countered the increased output from Chile, where Codelco and BHP’s Escondida reported year-on-year gains, although the Collahuasi mine faced significant declines.

The International Copper Study Group indicated a global refined copper surplus of 57,000 tons in July, contrasting with a deficit of 14,000 tons in June. Meanwhile, the year-to-date surplus has decreased to 101,000 tons from 401,000 tons in the same period last year.

From a technical perspective, there was a clear indication of fresh buying, as open interest increased by 17.51% to reach 6,590 contracts, accompanied by a price gain of Rs 27.4. Support is positioned at Rs 921.8; a decline beneath this level would pave the way to Rs 897.9. Conversely, resistance is established at Rs 959.7, beyond which prices may approach Rs 973.7.