Copper prices experienced a decline of 0.62%, settling at Rs 1,268.1. This movement can be attributed to the intensification of geopolitical tensions in the Middle East, which in turn bolstered the U.S. dollar and heightened apprehensions regarding global manufacturing activity. Renewed hostilities between the United States and Iran, coupled with stricter limitations on Iranian energy exports, have driven up energy prices and heightened expectations for rising interest rates, thereby negatively impacting the demand forecast for industrial metals. Supply concerns, however, persisted in offering foundational support.

Disruptions in the availability of sulphuric acid, stemming from regional conflict, have impacted copper refining operations. Concurrently, Chile’s copper production experienced a year-on-year decline of 12.9% in May. Shanghai Futures Exchange copper inventories decreased by 9.6% over the week, indicating a rise in demand within China. In May, China’s refined copper production experienced a year-on-year increase of 2.2%, coinciding with unwrought copper imports reaching a seven-month peak, driven by robust investment in power grid infrastructure. The International Copper Study Group reported a global refined copper deficit of 145,000 metric tonnes in April, reversing the surplus recorded in March.

However, the market remains in surplus for the first four months of the year. Meanwhile, Ivanhoe Mines anticipates increased production from its Kamoa-Kakula project in the latter half of 2026, potentially enhancing future supply. Goldman Sachs has revised its end-2026 copper price forecast upward to $13,735 per metric tonne, attributing this adjustment to tighter global supply conditions. Meanwhile, Citi has increased its near-term forecast to $14,500 per tonne, driven by expectations of ongoing supply constraints and uncertainties related to tariffs. However, the swift increase in Comex inventories alongside anticipations of a more stringent U.S. monetary policy persist in dampening sentiment.

Technically, the market is experiencing renewed selling pressure, as evidenced by a 0.12% increase in open interest in conjunction with declining prices. Copper is anticipated to encounter immediate support at Rs 1,257, with subsequent support at 1,245.8. Resistance levels are identified at Rs 1,280.6, followed by Rs 1,293 in the event of further recovery.