Copper Slumps Amid Stronger US Dollar and Mine Disruptions
Copper prices have fallen due to a stronger US dollar and reduced buying from China's largest consumer, which is experiencing a pre-holiday slowdown.
The greenback's strength makes copper more expensive for buyers using other currencies, potentially softening demand. This comes as disruptions at major Chilean mines tighten near-term supply.
Disruptions include the suspension of operations at BHP's Escondida mine following a fatal accident and a strike vote by unions at Centinela, another Chilean copper producer.
The London Metal Exchange (LME) cash premium jumped to $107.5 a ton from zero a week earlier, indicating that nearby metal is harder to source. This 'backwardation' market shape can pull metal out of warehouses and make life harder for investors betting against copper in the near term.