Copper prices settled higher by 0.35% at Rs 1,367.45, buoyed by a resurgence in investor sentiment following indications that the United States and Iran were progressing toward a potential agreement that might facilitate the reopening of the Strait of Hormuz. Easing concerns over inflation and aggressive interest rate hikes have also bolstered industrial metals. However, US President Donald Trump asserted that Washington would persist with its blockade measures until a formal agreement is reached, thereby constraining wider market optimism. Additional support for copper prices persisted due to robust long-term demand expectations associated with global electrification, the expansion of renewable energy, infrastructure for artificial intelligence, and investments in power grids.

Simultaneously, persistent supply disruptions associated with the Middle East conflict, especially the shortages of sulphuric acid utilised in copper smelting, have further constrained market conditions. Fundamentally, China continued to be a significant catalyst for global copper demand. In April, China experienced a year-on-year increase of 1.6% in refined copper production, reaching 1.27 million metric tonnes. Concurrently, unwrought copper imports saw a rise of 3.2%, achieving a seven-month peak of 452,000 metric tonnes. Robust investment in high-voltage power infrastructure, evidenced by a 37% increase in grid spending during the first quarter of 2026, has markedly enhanced consumption.

Meanwhile, copper inventories at the London Metal Exchange have decreased to a ten-week low of 275,525 metric tonnes, indicating a contraction in global supplies. Concerns regarding mine output have continued, as copper production in Chile experienced a decline of nearly 6% in the first quarter. Simultaneously, concentrate imports into China saw a significant year-on-year decrease of 20%. Despite the International Copper Study Group’s projection of a modest surplus of 96,000 metric tonnes in the refined copper market by 2026, ongoing supply risks from Indonesia, Chile, and the Democratic Republic of Congo persist in bolstering prices.

Technically, the market is experiencing new buying activity, evidenced by an 11.56% rise in open interest, which has settled at 13,301 lots, alongside a price increase of Rs 4.8. Copper is presently encountering support at Rs 1,359.7, with additional declines anticipated to challenge the Rs 1,352 levels. On the upside, resistance is identified at Rs 1,372.4, and a sustained movement above this threshold could propel prices toward Rs 1,377.4.