Copper Market Faces Severe Supply Squeeze Amid LME Inventory Decline

The copper market is facing severe supply constraints, with LME inventories declining for 42 consecutive days since 2014.

LME copper stocks have fallen to 204,975 tons, and nearly half of the remaining metal has already been scheduled for withdrawal.

The physical tightness in the copper market is being compounded by flows toward the U.S., where expectations surrounding tariffs on refined copper have created an arbitrage opportunity.

This has drawn metal away from the LME system, further tightening the immediately available supply.

Copper-focused ETFs are already rallying, with the Sprott Copper Miners ETF (NASDAQ:COPP) up about 15% over the past month and the Sprott Junior Copper Miners ETF (NASDAQ:COPJ) gaining roughly 17%.