Copper prices increased by 0.15% to close at Rs 1,272.25, bolstered by constrained global supply conditions following a 12.9% year-on-year decline in Chile’s copper production in May, which totalled 423,623 metric tonnes. Additional support stemmed from apprehensions regarding potential US tariffs, which prompted increased shipments into the United States and constrained availability in other regions. Market participants are closely monitoring the results of the US Commerce Department’s examination of the refined copper market and the state of domestic refining capacity.

Meanwhile, China’s industrial profit growth moderated to 21.1% in May from 24.7% in April. However, profits for the January-May period remained robust, reflecting an 18.8% increase. Supply fundamentals continued to exhibit support, even in the face of increased production from China. LME copper inventories have decreased to 339,100 tonnes, marking the lowest level since March. Meanwhile, stocks on the Shanghai Futures Exchange fell by 5.7% to 135,732 tonnes, the lowest recorded since December. China’s refined copper production rose by 2.2% year-on-year in May, reaching 1.26 million metric tonnes, indicative of strong domestic output.

The International Copper Study Group reported a global refined copper deficit of 145,000 metric tonnes in April, attributed to consumption surpassing production. In April, China experienced a year-on-year increase of 3.2% in unwrought copper imports, totalling 452,000 metric tonnes, bolstered by robust investment in power infrastructure. Conversely, imports of copper concentrate saw a decline of 20%. Major investment banks maintain a positive outlook, as Goldman Sachs and Citi have adjusted their medium-term copper price forecasts upward, attributing this to ongoing supply deficits and a deceleration in mine expansions.

Technically, Copper is experiencing short covering, as evidenced by a 1.81% decline in open interest, which suggests that bearish positions are being unwound. Immediate support is identified at Rs 1,260, with subsequent support at Rs 1,247.6. Resistance is established at Rs 1,280.8. A sustained breakout above this level could extend gains toward Rs 1,289.2.