Copper gains on demand optimism after US tariffs struck down

LONDON: Copper prices rose to two-week highs on Wednesday as growth and demand optimism dominated the mood after the US Supreme Court ruled against President Donald Trump’s sweeping reciprocal tariffs. Benchmark copper on the London Metal Exchange traded 0.7percent higher at USD13,257 a metric ton in official rings after rising to USD13,320 earlier in the session, the highest since February 12.

The US Supreme Court last week struck down tariffs imposed by Trump that he pursued under a law meant for use in national emergencies. “Asian markets are benefiting from the Supreme Court’s tariff ruling, which replaced higher reciprocal tariffs with lower Section 122 rates, around 10percent,” said BNP Paribas commodities strategist David Wilson.

“This shift has driven renewed interest in industrial metals, especially in China after the Lunar New Year holiday.” Expectations of stronger demand in top consumer China are highlighted by the Yangshan copper premium SMM-CUYP-CN, a gauge of China’s appetite for importing copper. It jumped to USD53 a ton on Tuesday from USD33 a ton on February 13, the day before the Chinese holiday started. However, traders tracking inventories remain wary.

Copper stocks in warehouses registered with the LME at 249,650 tons are at their highest since March 7 and up more than 80percent since January 9.

In warehouses monitored by the Shanghai Futures Exchange, copper stocks have climbed 180percent to 272,475 tons since mid-December.

Copper stocks on the LME, ShFE and on the US Comex exchange combined have exceeded a million ton for the first time in more than two decades. Elsewhere, tin hit USD53,100, the highest in nearly four weeks on supply concerns from Indonesia, where the government is studying a plan to ban exports of more raw materials, including tin.

Tin traded up 5.1percent at USD52,880. Traders said tin’s moves on the LME are often volatile due to an illiquid market.

In other metals, aluminium advanced 1.2percent to USD3,131, zinc was little changed at USD3,381, lead added 0.4percent to USD1,963.5 and nickel firmed 0.2percent to USD17,950.