Copper settled 0.18% higher at Rs 1,378.3, buoyed by diminishing inventories and a constricting supply landscape beyond the borders of the United States. LME copper inventories decreased to 204,975 tonnes, reflecting a 48% decline since late May. Concurrently, the cash premium over three-month futures increased to $256.50 per tonne, marking the highest level since June 2025, which underscores the tightness in nearby supply. Warehouse inventories at the Shanghai Futures Exchange experienced a decrease of 0.5% compared to the prior week. However, the Yangshan premium declined to $96 per tonne from $115 last month, signalling a reduction in Chinese import demand as high prices deterred purchases.

Chilean miner Antofagasta has revised its 2026 copper production guidance downward to a range of 625,000-655,000 tonnes, a decrease from the previous estimate of 650,000-700,000 tonnes, following extreme rainfall that necessitated a shutdown at the Los Pelambres mine. Goldman Sachs significantly increased its projection for the 2026 refined copper deficit outside the United States to 640,000 tonnes, up from a prior estimate of 60,000 tonnes, underscoring the increasingly constrained supply scenario. Chilean production exhibited a mixed performance in June, with Escondida’s output increasing by 45.8% year-on-year to 111,400 tonnes and Collahuasi’s output rising by 1.7% to 34,900 tonnes.

In contrast, Codelco experienced a decline of 4.8%, resulting in an output of 114,400 tonnes. The ICSG reported an 18,000-tonne refined copper surplus in May, contrasting with a 145,000-tonne deficit in April, while the surplus for the January-May period totalled 221,000 tonnes. China’s unwrought copper imports fell by 11.5% year-on-year, totalling 425,000 tonnes in July. In contrast, refined copper production saw a 2.5% increase, reaching a record 1.334 million tonnes. Copper product output declined by 2.3%, suggesting a decrease in downstream demand.

Technically, the market is experiencing short covering, evidenced by a 0.25% decline in open interest to 9,556 contracts, while prices have increased by Rs 2.45. Copper has support at Rs 1,369.8, and a break below could test Rs 1,361.3. Resistance is positioned at Rs 1,384.2, and a sustained movement above this threshold could propel prices toward Rs 1,390.1.