LONDON: Copper prices hit their highest in almost two weeks on Tuesday as the dollar fell and the yuan strengthened after US President Donald Trump’s announcement of a ceasefire between Israel and Iran.
Three-month copper on the London Metal Exchange was up 0.7% at $9,730 a metric ton in official open-outcry trading after touching $9,760.50 for its highest since June 11 earlier in the session.
Global markets largely ignored signs that the ceasefire could be fragile, with Trump accusing both Israel and Iran of violating the agreement on Tuesday.
The metals market’s attention was on continuing outflows from copper stocks in LME-registered warehouses, which combined with large holdings of cash copper contracts and warrants - title documents conferring ownership - to inflate premiums for near-term contracts. The premium for the cash copper contract over the three-month forward eased to $230 a ton on Tuesday.
It had closed at $280 on Monday for its highest since November 2021, indicating tightness in the LME copper system. Copper inventories in LME-approved warehouses are down 65% since mid-February at 94,675 tons, their lowest since August 2023, as some traders diverted metal to the United States to benefit from the premium on COMEX copper futures over the LME benchmark while Washington continues to consider potential tariffs on copper imports.
“The metal drips out of the warehouses every day,” one metals trader said. “LME copper price is so much lower than Comex that the LME (system) can’t attract deliveries.” In other LME metals, aluminium fell 0.8% to $2,568 a ton in official activity as the Iran-Israel ceasefire drove down oil prices and removed the immediate threat to the Strait of Hormuz shipping lane for Middle East aluminium producers. Aluminium, the smelting of which requires large amounts of energy, touched a three-month high of $2,654.50 on Monday. LME lead rose 1.1% to $2,025 after hitting $2,029 for its highest since March 31 while zinc added 0.8% to $2,708 after touching $2,715.50, its highest since June 4.
Both metals were supported by outflows from the LME stocks and additional metal marked as being prepared for delivery out. Tin climbed 0.2% to $32,750 while nickel gained 0.8% to $14,925.
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