Copper Prices Stabilize as LME Deliveries Ease Historic Supply Crunch
Copper prices declined initially but later stabilized on Tuesday as significant deliveries of the metal to London Metal Exchange (LME) warehouses eased a historic supply crunch.
The LME's readily available copper inventories jumped by more than 20,000 tons on Tuesday, the largest increase since April. Trafigura Group was behind a substantial share of these deliveries, according to Bloomberg News, while other traders also arranged to bring copper onto the exchange.
Benchmark three-month copper futures on the LME fell as much as 0.5% before recovering to trade at $13,976 a ton by 11:02 a.m. in Shanghai. This followed a decline of 1.2% on Tuesday, the biggest one-day drop since July 23.
The supply crunch was driven largely by an arbitrage trade in anticipation of import tariffs, but a deadline for the US Commerce Department's recommendation to President Donald Trump passed in June without any announcement from the White House.