Copper yesterday settled down by 0.79% at Rs 1337.55 as concerns over weakening demand sentiment intensified following softer-than-expected economic data from China and elevated crude oil prices. China’s industrial production rose by 4.1% in April compared to the same month last year, a notable deceleration from the 5.7% growth recorded in March, and falling short of market forecasts which anticipated a 5.9% increase. The weaker industrial activity data from the world’s largest copper consumer has raised concerns regarding near-term demand prospects, subsequently exerting downward pressure on copper prices. Market sentiment exhibited caution as several prominent Chinese copper smelters engaged with government officials in advance of the annual negotiations with global miners concerning processing fees set to commence in July.

Despite the decline, the downside remained constrained due to persistent supply-side concerns and tightening inventories. Copper inventories tracked by the Shanghai Futures Exchange experienced a decrease of 0.4% compared to the prior week, while the Yangshan copper premium has escalated by 260% since February, indicating robust import demand in China. China’s refined copper imports are anticipated to increase in the second quarter, driven by strong consumption and diminished domestic production resulting from smelter maintenance. Supply concerns also persisted after Chile’s copper production declined nearly 6% during the first quarter of 2026, while Freeport-McMoRan maintained expectations for full production recovery at the Grasberg mine only by the end of 2027.

The International Copper Study Group reported a global refined copper surplus of 276,000 metric tons in February, an increase from 34,000 tons in January. The organization now projects a surplus of 96,000 tons in 2026 and 377,000 tons in 2027, influenced by a deceleration in global demand growth and a rise in secondary supply. However, robust investment in China’s power grid infrastructure, with expenditures increasing by 37% during January–March 2026, continues to underpin long-term copper demand.

From a technical perspective, the market is experiencing long liquidation, evidenced by a 0.87% decrease in open interest, which settled at 9205, alongside a price decline of Rs 10.7. Copper is currently finding support at Rs 1332; should prices fall below this level, they may test the Rs 1326.5 mark. Conversely, resistance is identified at Rs 1345.6, with a potential upward movement likely to challenge the Rs 1353.7 level.