LME Copper Price Jumps to Record High Amid Trading Turmoil

The London Metal Exchange (LME) has witnessed an unusual surge in copper prices, reaching a record high of $14,912 per ton on Monday. This sudden increase in cash price has led to a ballooned backwardation of $545 per ton, causing tension among traders.

The turmoil is attributed to the intersection of trading positions ahead of a prime prompt date, with large holdings by three entities pushing cash positions past physical stocks available in LME warehouses. As a result, there's a scramble to deliver metal.

Despite some easing of the 'tom-next' spread and cash-to-three-month backwardation, the US demand for copper remains strong. The tariff uncertainties under Trump and the gap between LME backwardation and CME contango suggest that this August storm may be only the beginning.