Copper firms on soft dollar, set for monthly gain

SINGAPORE: Copper prices firmed on Friday and were set to for a monthly gain, as the market digested a cheaper dollar and continuing supply pressure.

Benchmark three-month copper on the London Metal Exchange was flat at $13,804.5 a metric ton by 0300 GMT, and was on track for a 3.25% gain for the month.

Meanwhile, the most-traded copper contract on the Shanghai Futures Exchange rose 0.71% to 105,510 yuan ($15,635.74) a ton, notching a 2.75% increase since the start of the month.

The dollar tumbled overnight, making commodity deals using the greenback cheaper for buyers using other currencies. Copper has been supported this month by falling stock levels, concerns about supply, and good demand from China.

Total stocks of the red metal in LME-registered warehouses were 255,400 tons on Thursday, down 21.38% in July.

Over 60% of the remaining stocks were under cancelled warrants, meaning they were earmarked for removal.

Stocks have been pressured by the movement of copper into the US ahead of potential tariffs on imports of the metal.

Meanwhile, demand in China was boosted by a lack of copper scrap, forcing some scrap consumers to buy refined metal.

The Yangshan copper premium, a gauge of physical demand for the metal was at $112 a ton, down from its monthly high, but still 57.75% up for the month.

Aluminium inched 0.03% down on the LME and added 0.21% on the SHFE.

It was on track to end the month higher, but remained well below May’s highs after a short-lived Middle-East detente wiped out the war risk premium in June.

Stocks of the light metal in LME-registered warehouses are at their lowest level this century.

Among LME metals, zinc was little changed, lead lost 0.42%, nickel ticked 0.12% higher and tin added 0.42%.

Among SHFE metals, zinc gained 0.73%, lead lost 1.24%, nickel added 0.45% and tin rose 1.72%.