Copper stays range bound as US tariff uncertainty, oil inflation risks weigh

ETMarkets.com

Copper prices are trading in a range as the US administration is yet to decide on proposed tariffs amid supply constraints and rising prices.

Three month copper on the London Metal Exchange was up 0.1% at $14,353 a metric ton by 0955 GMT, marking a third straight session of tight trading.

The metal has gained 55% since Donald Trump returned to the US presidency in January 2025, even as global demand fell 0.5% to 27 million metric tons, Panmure Liberum analyst Tom Price said in a note.

China demand offers support

A shortage of copper scrap in China was providing another source of support. Goldman Sachs said the shortfall was increasing China's need for refined copper through domestic inventory drawdowns, while the US continued importing metal and building stocks ahead of possible tariffs.

The Yangshan copper premium, a key gauge of China's demand for imported copper, climbed 0.7% to $138 a ton, its highest level in almost four years.

Tariff uncertainty keeps traders cautious

The White House is yet to decide on tariffs on refined copper, with the administration increasingly focused on affordability ahead of November's midterm elections, Reuters reported in September, citing people familiar with the matter.

Chinese broker Everbright Futures said cautious purchasing at high prices and uncertainty over US tariffs could keep copper prices range bound in the near term.

Meanwhile, copper inventories on the Comex stood at a record 718,199 metric tons, up sharply from 87,241 in January 2025, highlighting the build up of metal in the US.

Goldman Sachs expects copper prices to average $15,400 in 2027, compared with $14,700 at the end of 2026.

Supply disruptions also remained in focus. BHP Group and Anglo American reported copper production declines of 19% and 5%, respectively, due to disruptions in Chile, although both maintained their full year output guidance.

Among other LME metals, aluminium fell 0.8% to $2,993, zinc lost 0.7% to $3,688, while nickel rose 0.5% to $15,600. Tin gained 0.1% and lead was steady.