Copper settled up 0.78% at Rs 1,410.5 as diminishing expectations of a US Federal Reserve rate hike overshadowed the influence of a stronger dollar. Supply concerns have bolstered the bullish sentiment following a 12.8% year-on-year decline in Chilean copper production in August, which reached 369,500 tonnes-the lowest figure recorded since February 2011. Additionally, workers at Antofagasta’s Centinela mine have voted to strike, and supervisors at Escondida have turned down a collective contract offer, thereby heightening the risks of further supply disruptions.
China’s copper-intensive manufacturing activity showed signs of improvement in September, as evidenced by the official PMI increasing to 50.1 from 49.8, while the private RatingDog PMI achieved a five-month high of 52.1. Shanghai Futures Exchange copper stocks experienced a notable decline of 17.8% week-on-week, reaching 38,744 tonnes, marking the lowest level since January 2024. This trend underscores robust pre-holiday demand. The Yangshan import premium rose to $119 per tonne, while China’s domestic physical premium declined to 1,050 yuan.
Bank of America has increased its 2031 copper price forecast by 20% to $13,577 per tonne, attributing this adjustment to limited supply outside the United States and ongoing tight conditions in China. The global refined copper market experienced a deficit of 51,000 tonnes in July; however, the cumulative figures for the January-July period indicated a surplus of 32,000 tonnes. In July, refined output reached 2.41 million tonnes, while consumption was recorded at 2.46 million tonnes. Meanwhile, China’s unwrought copper imports decreased to 382,000 tonnes in August from 425,000 tonnes in July, while imports from January to August saw a year-on-year decline of 6.7% to 3.30 million tonnes.
COMEX copper speculators decreased their net long positions by 3,940 contracts, bringing the total to 78,709. Technically, copper is experiencing short covering as open interest decreased by 0.32% to 8,292, while prices increased by Rs 10.9. The market is currently establishing support at Rs 1,402.6, and a persistent breach beneath this threshold may reveal Rs 1,394.8. On the upside, resistance is positioned at Rs 1,415.1, and a decisive move above this threshold could catalyse additional recovery toward Rs 1,419.8.
