LONDON: Copper prices edged higher on Tuesday on supply worries and continued interest from speculators, countered by a slightly firmer dollar and uncertainty over US interest rates.
Benchmark three-month copper on the London Metal Exchange rose 0.2 percent to USD13,235 a metric ton in official open-outcry trading, recovering from an intraday low of USD13,033 in Asian trading.
LME copper has surged 45 percent over the past 12 months, hitting successive record highs, including USD13,387.50 last week.
“There’s loads of liquidity around and a lot of people are trying to get away from the US and find safe havens outside that in terms of financial markets,” said Dan Smith, managing director at Commodity Market Analytics.
There is a good chance LME copper will break through the USD14,000 barrier in the near future, he added.
Copper’s rally has been fuelled by disruptions at mines, worries about deficits this year and a flow of copper to the US ahead of potential tariffs that are tightening supply elsewhere.
The tightness is showing in available LME copper inventories, which fell 22 percent to the lowest level in six months, LME data showed on Tuesday.
It is also appearing in the rising premium on LME cash copper over the three-month contract. The premium rose to USD64 a ton on Tuesday for its highest in a month and up from USD3 a week ago.
Some traders were on the sidelines, however, ahead of US consumer price index data on Tuesday. After softer jobs data, Goldman Sachs pushed back its forecasts for the US Federal Reserve to cut interest rates in 2026.
“Hopes of any near-term rate cuts have been dashed, pulling the trigger for a pullback in prices,” said one Beijing-based trader.
The most traded copper contract on the Shanghai Futures Exchange closed daytime trade 0.5 percent down at 102,290 yuan (USD14,662.71) a ton.
Among other metals, LME aluminium shed 0.1 percent to USD3,183 a ton, nickel dropped 0.5 percent to USD17,800 and tin was down 0.1 percent at USD47,925 after hitting its highest since March 2022 at USD49,380.
Zinc climbed 1.2 percent to USD3,255 a ton after touching its strongest since October last year at USD3,274 while lead added 0.4 percent to USD2,060.50.
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