Copper prices held above the psychological level of $14,000 per metric ton on Wednesday, supported by falling inventories in the London Metal Exchange system as more metal was pulled into the U.S. ahead of potential tariffs on refined copper. Benchmark three-month copper on the LME was down 0.1% at $14,053 a metric ton in official open-outcry trading. The contract hit $14,117, its highest level since May 14, on Tuesday. Daily LME stocks data showed that more metal was pulled out of LME-registered warehouses in Asia. With 6,525 metric tons of outflows on Tuesday, total stocks are at 231,825 tons, the lowest since mid-February, with available stocks at 94,125 tons, the lowest since mid-January. Signalling tightening conditions for near-term supply, the premium of the LME cash copper contract over the three-month contract was last at $103 a ton, the highest level since October.
COMEX copper traded at a premium against the LME benchmark as the market awaited a potential U.S. import tariff decision, encouraging inflows into COMEX inventories. COMEX stocks pulled in 45,000 tons in July alone. On the supply side, Chile's Codelco paused one of its expansion projects at its flagship El Teniente mine a year after a deadly collapse, saying recent studies show greater seismic risk.
"We remain constructive on the copper market given the physical and longer-dated tightening, the supply disappointments, and the uncertainty around tariffs," analysts at RBC Capital Markets said. Supporting copper and other growth-dependent metals was improved risk sentiment after U.S. President Donald Trump said his administration had "very good discussions" with Iran on Tuesday, fuelling expectations of an end to the five-month war. Among other LME metals, zinc rose 0.5% to $3,691 a ton in official activity after hitting $3,709, a four-year high. With LME available zinc stocks at 73,825 tons, the lowest level since December, short-term LME zinc contracts were trading at a premium over contracts with longer maturities. LME aluminium added 0.2% to $3,229, lead fell 0.3% to $1,889.5, tin gained 0.7% to $56,400 and nickel lost 0.7% to $17,080.
