Copper Prices Poised to Rise Amid Supply Deficit and Limited Inventory

Copper prices were relatively steady on Friday and are poised to rise by 3% in July due to increased risk appetite in equity markets and concerns about a lack of visible stocks outside the US.

The benchmark three-month copper price on the London Metal Exchange held at $13,798 a metric ton after reaching its highest level since July 22 at $13,883 earlier in the day.

ING commodities strategist Ewa Manthey noted that 'Copper enters August with supportive fundamentals' and that the market is still facing a supply deficit and limited inventory buffers outside the US.

The available copper stocks in LME-registered warehouses fell by 50% in July, dropping to their lowest level since mid-January at 101,650 tons. This indicates some tightness for nearby supply, with the premium of the cash LME copper contract over the three-month forward reaching a seven-month high of $40 a ton on Thursday.