Copper falls from near-record highs on profit-taking, firmer dollar
- Benchmark three-month copper on the London Metal Exchange (LME) was down 0.3% at $14,700 a ton
LONDON: Copper prices fell on Wednesday due to a stronger dollar and as investors took profits after the metal tested a key technical resistance level above $14,800 a metric ton.
Benchmark three-month copper on the London Metal Exchange (LME) was down 0.3% at $14,700 a ton by 1005 GMT, after earlier touching $14,833, its highest level since September 10, when it hit a record high of $14,875.
Comex copper hit a record high of $6.83 per lb, or $15,057 a ton, on Tuesday before retreating on Wednesday.
Comex copper inventories have started to record modest daily inflows as the premium of US copper futures over LME prices edged higher after a sharp pullback.
That pullback was triggered by a Reuters report that the White House had yet to decide on copper import tariffs amid concerns about affordability.
After months of heavy inflows, Comex warehouses now hold 69% of the roughly 1 million tons of copper tracked by global exchanges, supporting concerns about tightness outside the US.
The backdrop has helped LME copper rise 18% so far this year and currently coincides with signs of robust demand in top consumer China ahead of public holidays on September 25 and October 1 to 7.
It also comes as half of the 252,500 tons of copper stored in LME-registered warehouses has been earmarked for delivery out.
The impact of these supportive factors is evident in the spread between the LME cash copper contract and the three-month benchmark, which swung into a premium this week.
The premium was last at $76 a ton, compared with a discount of $86 on September 14.
“Buyers are willing to pay a premium to secure metal sooner, reinforcing the narrative of a tighter market,” analysts at RBC Capital Markets said, adding that they were watching whether additional supply would flow into warehouses in the coming weeks.
LME aluminium fell 0.2% to $3,259.50 a ton, while zinc and lead eased 0.5% to $3,888.50 and $1,926.50, respectively. Nickel lost 0.3% to $16,570, while tin gained 0.1% to $54,250.
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