Copper Prices Take Breather Amid Tariff Uncertainty
Copper prices have taken a breather after testing record highs, according to Reuters. The recent pullback is seen as more of a pause than a reversal, with LME three-month copper slipping back from its near-record level. US COMEX futures also eased from their fresh high, as traders digested the news that the White House has yet to decide on copper import tariffs.
The uncertainty over tariffs and the strengthening US dollar have contributed to the cool-down in copper prices. However, it's worth noting that outside of the US, the physical market still looks tight. Reuters reported that COMEX warehouses now hold 69% of the roughly 1 million tons tracked by major exchanges.
The squeeze in supply is evident in the LME cash-to-three-month spread, which has flipped to a $76-a-ton premium this week from an $86 discount on September 14th. This 'backwardation' market dynamic indicates that buyers are paying extra for immediate delivery rather than waiting for later contracts.