Copper settled lower yesterday by -0.44% at Rs 939.55, as profit booking emerged following recent gains that were driven by supply disruption concerns after Freeport-McMoRan’s force majeure declaration at the Grasberg mine in Indonesia. Copper inventories in Chinese warehouses decreased by 6.6%, and the Yangshan copper premium remained stable at $53 per ton, indicating a consistent yet measured demand for imported copper.

Goldman Sachs has adjusted its projections for global copper mine supply for the years 2025 and 2026, anticipating a cumulative reduction of 525,000 metric tons as a result of the disruption. This revision leads to a decrease of 160,000 tons in supply for the latter half of 2025 and a reduction of 200,000 tons for the year 2026. Citi has adjusted its short-term copper price forecasts to $10,500 per ton, attributing this revision to supply disruptions. The firm anticipates a potential market deficit of 400 kilotons by 2026, with prices projected to rally between $12,000 and $14,000 per ton. Refined copper consumption is anticipated to increase by 2.9% in the coming year, reaching 27.5 million tons. This shift is expected to transition the market from the current surplus of 63,000 tons to a deficit of 308,000 tons.

In early September, copper production in China experienced a decline of 5%, which was somewhat mitigated by heightened output from Chile’s Codelco and Escondida mines. Conversely, Collahuasi reported a significant reduction in output, plummeting by 27.2%. In July, global refined copper markets experienced a surplus of 57,000 tons, while the figures for the first seven months indicate a total surplus of 101,000 tons.

From a technical perspective, the market is experiencing new selling pressure, as evidenced by a 5.73% increase in open interest, reaching 7,143 contracts. Copper is currently finding support at Rs 933.6, with potential for further decline to Rs 927.5. Resistance is identified at Rs 946.2, and a breakout above this level could lead to a test of Rs 952.7.