Copper settled 0.37% lower at Rs. 1,398.80 amid profit booking, diminished concerns regarding mine supply disruptions, a downturn in artificial intelligence stocks, and renewed inflation worries that heightened the probability of additional US interest rate hikes. In September, there was an acceleration in US consumer prices, which negatively impacted sentiment surrounding industrial metals. Conversely, a recent agreement between the supervisors’ union and management at Chile’s Escondida mine, recognised as the largest copper mine globally, contributed to alleviating immediate supply concerns.
However, supply risks persisted after Chilean state miner Codelco partially suspended operations at its El Teniente mine due to a landslip, while labour disputes continued at Antofagasta’s Centinela mine. Antofagasta reported a 7% increase in third-quarter copper production while maintaining its annual outlook. China’s copper imports experienced a month-on-month increase of 20.7%, reaching 461,000 tonnes in September. Concurrently, inventories monitored by the Shanghai Futures Exchange rose by 20,000 tonnes, totalling 58,744 tonnes at the end of September. Chilean copper production exhibited varied trends, as Codelco’s output in August increased by nearly 9% year on year to 101,700 tonnes.
In contrast, Escondida’s production experienced a significant decline of 27.6%, totalling 76,100 tonnes, while Collahuasi’s output fell by 25.1% to 26,500 tonnes. The International Copper Study Group projected the global refined copper market to remain in surplus, widening from approximately 104,000 tonnes in 2026 to 368,000 tonnes in 2027. Refined copper production is projected to rise by 0.4% in 2026 and by 3.4% in 2027, bolstered by the introduction of new smelting and refining capacities in Indonesia, India, and the European Union.
Meanwhile, refined copper usage is projected to increase by 1.5% in 2026 and 2.5% in 2027, driven by factors such as electrification, renewable energy, urbanisation, digitalisation, and demand from data centers. Technically, copper is experiencing new selling pressure, as open interest has risen by 1.71% to 7,274 contracts, while prices have decreased by Rs. 5.15, suggesting a reinforcement of bearish sentiment. Immediate support is positioned at Rs. 1,392.50, beneath which prices may test Rs. 1,386.50. Resistance is identified at Rs. 1,405.00, and a sustained movement above this threshold may propel prices toward Rs. 1,411.50.
