LONDON: US copper prices stabilised on Friday after the biggest one-day decline on record the previous day as the market continued to assess a surprise move by US President Donald Trump to exclude refined metal from 50% import tariffs.
US September Comex copper futures were last up 1.6% at $4.423 per lb, or $9,751 a metric ton, after plunging by 22% on Thursday. Benchmark three-month copper on the London Metal Exchange rose 0.4% to $9,645 a ton by 1607 GMT as the dollar fell after US job growth slowed more than expected in July and traders ramped up bets on how many times the Federal Reserve was likely to cut rates this year.
A weaker US currency makes dollar-priced metals more attractive for buyers using other currencies, while lower rates improve prospects for growth-dependent copper.
Price pressure was applied by rising copper stocks in LME-registered warehouses and the risk of more inflows from massive inventories in the US after Washington excluded refined copper from its import tariffs. Copper stocks in Comex-owned warehouses are at a 21-year high of 233,977 tons after 176% growth over the March-July period. Available LME stocks, meanwhile, more than doubled in July and are at a three-month high of 127,475 tons.
Limiting the prospect of massive outflows from US stocks in the short term is the Comex copper futures premium over the LME price, even with this week’s price falls. “Comex copper’s premium is now only a few hundred dollars, which is still huge historically but nothing compared to the recent $3,000 premium,” one metals trader said. Trump imposed steep tariffs on exports from dozens of trading partners, including Canada, Brazil, India and Taiwan, ahead of Friday’s trade deal deadline.
China, the world’s top metals consumer, is facing an August 12 deadline to reach a durable agreement with Washington. On the supply side, Chilean copper giant Codelco said five workers were trapped at the new Andesita unit of its flagship El Teniente mine after a 4.2 magnitude tremor on Thursday.
Andesita was due to begin production in the second quarter. Among other LME metals, aluminium rose 0.2% to $2,570 a ton, lead gained 0.2% to $1,974, tin jumped 1.8% to $33,300 and nickel added 0.5% to $15,005. Zinc fell 1.1% to $2,729.
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