Copper bounces from 3-week low on bargain hunting; COMEX outperforms

LONDON: Copper prices rebounded after hitting a three-week low on Tuesday, as investors took advantage of lower prices, while U.S. prices outperformed on speculation about possible tariffs on the metal.

Benchmark three-month copper on the London Metal Exchange added 0.3% to $13,038 per metric ton by 0930 GMT, after hitting its lowest level since April 13 at $12,780.

Trading activity was muted, with the Shanghai Futures Exchange closed for the Labour Day holiday.

Copper, which peaked at a record of $14,527.50 a ton in late January, has been under pressure since the Iran war.

Slowing economic growth could hit demand for the metal used in construction, electric vehicles and artificial intelligence data centres.

The U.S. and Iran exchanged fire on Monday as they wrestled for control of the Strait of Hormuz.

“Escalation between the U.S. and Iran revived concerns about a broader macro shock - higher energy prices, tighter financial conditions, and weaker industrial demand,” said Ewa Manthey, commodities strategist at ING.

But many investors still believe the long-term outlook for copper is bullish, prompting some to buy the dips, she added.

In the U.S., COMEX copper futures gained 2.1% to $5.97 a lb, giving it a slight premium of about $115 a ton over LME copper.

Manthey noted that the arbitrage was pulling metal to the U.S., with the Trump administration expected to decide in July whether to impose tariffs on refined copper, insulating it from some of the global risk-off pressure weighing on the LME.

COMEX inventories have climbed to successive record highs, reaching 615,852 short tons (558,692 metric tons) on Monday, more than doubling over the past eight months. LME zinc rose 0.4% to $3,358.50 a ton, seeming to shrug off news that two people were killed in an explosion at the

Glencore-owned Kazzinc plant, Kazakhstan’s largest zinc production facility.

Among other LME metals, aluminium was up 0.2% at $3,529 a ton, nickel added 0.4% to $19,450, lead rose 0.4% to $1,959.50 and tin gained 0.6% to $49,695.