Copper heads for strongest week since May on supply concerns and tight stocks

LONDON: Copper prices rose on Friday as supply concerns and tight inventories outside the U.S. left the metal on course for its strongest week in almost three months.

Benchmark three-month copper on the London Metal Exchange was up 0.3% at $14,141 a metric ton by 0850 GMT and set to finish the week up 2.5% for its biggest weekly gain since the week to May 8.

LME copper touched a six-month high of $14,369.50 on Thursday after Reuters reported that the Democratic Republic of Congo had banned copper concentrate exports with immediate effect.

“The news reinforced an already bullish market backdrop characterised by low inventories, tight concentrate availability and ongoing supply disruptions,” ING said in a note.

Available LME copper stocks declined to 92,900 tons, the lowest since January, after a further 1,775 tons of warrant cancellations — orders to withdraw metal from warehouses, mostly in Kaohsiung.

The cash to three-month spread remained in steep backwardation of $119 a ton, indicating near-term tightness. Backwardation refers to the market condition where spot prices are higher than futures contracts.

Shanghai Futures Exchange copper stocks nudged up 1.1% over the past week but remain at a historically low 70,116 tons.

In the U.S., meanwhile, COMEX copper stocks rose for a 34th consecutive day to 654,571 tons as metal flows to the country ahead of a possible tariff on imports.

COMEX copper, nonetheless, hit a record high of $6.73 per lb on Thursday.

U.S. President Donald Trump is expected to attend a round table with top mining executives on Friday as part of his administration’s efforts to expand domestic and allied supplies of critical minerals.

Aluminium gained 0.7% to $3,281.50 a ton, touching its highest since June 23, while zinc dipped 0.4% to $3,747.50 after notching an almost four-year peak above $3,800 on Thursday.

The backwardation in the three-month spreads remains steep for zinc at more than $65 a ton but has collapsed for aluminium to $4.70 from as much as $45 on Tuesday.

Lead added 0.3% to $1,890 a ton, nickel advanced 0.9% to $16,915 and tin was up 0.8% at $56,435.