While trade remained muted ahead of the week-long holiday in China, copper finished slightly down by 0.02% at Rs 1,401.65 as increased Chinese industrial activity offered support. China’s official manufacturing PMI increased to 50.1 in September from 49.8 in August, indicating a return to expansion territory. Meanwhile, the private RatingDog survey revealed even stronger momentum, with its manufacturing PMI rising to a five-month high of 52.1 from 51.5. Pre-holiday purchasing trends have led to a notable decline in copper inventories on the Shanghai Futures Exchange, with stocks decreasing by 17.8% from the prior week, now standing at 38,744 tonnes, marking the lowest level observed since January 2024.
However, China’s domestic physical copper premium eased to 1,050 yuan per tonne from 1,375 yuan, while the Yangshan import premium edged higher to $119 per tonne, indicating continued interest in imported material. Chilean copper production experienced a year-on-year decline of 12.8% in August, totalling 369,500 tonnes, down from 423,643 tonnes in the same month last year. This decrease can be attributed to disruptions caused by storms and a reduction in ore grades.
The global refined copper market continued to experience a deficit, registering a shortfall of 51,000 tonnes in July, down from 74,000 tonnes in June, as reported by the International Copper Study Group. However, the initial seven months of the year still documented a surplus of 32,000 tonnes, compared to a surplus of 157,000 tonnes during the corresponding period last year. Global refined output was recorded at 2.41 million tonnes in July, whereas consumption amounted to 2.46 million tonnes. China’s imports of unwrought copper and related products decreased to 382,000 tonnes in August.
For the period from January to August, imports experienced a year-on-year decline of 6.7%, totalling 3.30 million tonnes. Technically, copper is experiencing long liquidation, as evidenced by a 1.35% decline in open interest to 8,818, alongside a price decrease of Rs 0.25. Support is positioned at Rs 1,397.8, and a breach beneath this threshold may result in a decline to Rs 1,393.9. On the upside, resistance is observed at Rs 1,408.8, while a sustained move above this level could propel prices toward Rs 1,415.9.
