Copper prices declined by 0.72% to Rs 995.45, influenced by a robust U.S. dollar amid ongoing uncertainty regarding the Federal Reserve’s potential rate cuts in December. The attention now turns to the postponed September payrolls data, which may impact policy direction. In a further indication of bearish sentiment, LME copper inventories increased by 4,450 tonnes to reach 104,500 tonnes, marking the highest level since early October. The cash-to-three-month LME spread indicated a contango of $36.50 per ton, reflecting favorable near-term supply conditions. Partial operations at Indonesia’s Grasberg mine have resumed following Freeport-McMoRan’s response to a fatal accident in September, providing some supply-side relief.

The International Copper Study Group anticipates a refined copper surplus of 178,000 tons in 2025, transitioning to a deficit of 150,000 tons in 2026 as demand growth surpasses the deceleration in refined output. Global mine production is projected to increase by 1.4% in 2025, with a subsequent acceleration to 2.3% in 2026. Concurrently, refined copper usage is anticipated to grow by 3% in 2025 and 2.1% in 2026. ICSG’s latest monthly bulletin indicated a market surplus of 57,000 tons in July, contrasting with a deficit of 14,000 tons in June.

From January to July, the market recorded a surplus of 101,000 tons, a significant decline from the previous year’s surplus of 401,000 tons. In China, refined copper production experienced an increase of 8.9% year-on-year in October, reaching 1.2 million tons. However, this output represented a decline of 4.9% compared to September, marking the lowest monthly level since November 2024.

From a technical perspective, copper is currently experiencing long liquidation, as evidenced by a 12.24% decline in open interest to 6,660, coinciding with a price decrease of Rs 7.25. Support is identified at Rs 990, with a potential test of Rs 984.5 if that level is breached. Resistance is positioned at Rs 1001.1, and a breakout may propel prices towards Rs 1006.7.