Copper settled 1.24% lower at Rs. 1,351.15, as profit booking emerged following a recent rally driven by improving macroeconomic sentiment after the US midterm elections. In China, the Yangshan copper import premium has surged to $205 per tonne, marking its highest level in 12 years, which suggests a heightened demand for imported metal. However, apprehensions regarding the potential impact of Democratic electoral gains on investment in AI infrastructure tempered optimism, while high US inventories persisted in exerting downward pressure on prices.
US refined copper and alloy imports experienced a month-on-month decline of 3.1%, totalling 194,284 tonnes in September. However, this figure remains nearly double that of the same period last year. Cumulatively, imports from January to September reached 1.52 million tonnes, reflecting a year-on-year increase of 17%. COMEX copper inventories have reached a record high of 731,428 tonnes, while LME inventories in US warehouses have risen to their highest level in over a decade. In contrast, inventories monitored by SHFE have decreased by more than 75% over the past six months, underscoring the disparities in regional supply.
Chile’s copper commission Cochilco has significantly revised its 2026 production forecast, now anticipating an 8.4% decrease to 4.94 million tonnes from an earlier estimate of 5.27 million tonnes. The commission also projects a modest 3% recovery in 2027. It also raised its average copper price forecasts to $6.18 per pound for 2026 and $5.95 for 2027, citing constrained mine supply and production disruptions. However, the International Copper Study Group projected that the global refined copper market will continue to exhibit a surplus, with expectations for the surplus to expand from 104,000 tonnes in 2026 to 368,000 tonnes in 2027, bolstered by increased refined production.
Global copper consumption is projected to increase by 1.5% in 2026 and by 2.5% in 2027, driven by factors such as the energy transition, digitalisation, and the demand from data centers. Technically, the market is experiencing new selling pressure, as open interest has risen by 14.1% to 7,325 contracts, accompanied by a price decline of Rs. 16.90. Copper is currently finding support at Rs. 1,342; a decline below this level may lead prices to test Rs. 1,333. Conversely, resistance is established at Rs. 1,368, and a sustained movement above this threshold could facilitate a recovery toward Rs. 1,384.50.
