Copper steady as mine supply disruption, tight stocks lend support

LONDON: Copper held steady on Tuesday as persistent concerns over supply shortages shielded the metal from the selling pressure seen in equity markets, keeping it within reach of an all-time peak.

Benchmark three-month copper on the London Metal Exchange was little changed at USD14,624.50 a metric ton in official open outcry activity, close to the record USD14,875 struck last month.

Supply concerns remained in focus after Chile’s Codelco partially suspended operations at its El Teniente mine following a landslide, while Antofagasta’s Centinela copper mine and two unions were set to resume talks as a strike continued.

“Copper continues to benefit from physical-market tightness and declining exchange inventories, helping it withstand the firm dollar better than the wider complex,” Sucden Financial said in a note.

The dollar slipped from 18-month highs on Tuesday in line with a retreat in crude oil, making greenback-denominated metals more affordable for investors using other currencies and supporting prices.

All reported copper mine disruptions for 2025-26 amount to 350,000-400,000 tons per year of contained copper, which equates to only 30 percent-50 percent of published disruption allowances, Panmure Liberum said.

“Therefore, the dominant price driver is probably speculative/financial,” the investment bank added in a note.

A disruption allowance is a percentage of mine production that analysts assume will be lost due to unplanned events in a given year.

LME copper stocks declined by 1,625 tons to 232,275 tons, leaving inventories outside the US tight. The premium of the cash LME copper contract over the three-month forward remained steep at USD99 a ton but had almost halved from as much as USD181.50 on Monday.

Aluminium fell 0.5 percent to USD3,036 per ton, close to the eight-month low it touched on Monday. Some easing in passage restrictions in the Strait of Hormuz has reconnected Gulf smelters to the world, taking aluminium prices down, Panmure Liberum said.

New supply from Indonesia is also ramping up, with exports topping 150,000 tons in August.

Zinc slipped 0.1 percent to USD3,755.50, lead rose 0.6 percent to USD1,895, nickel edged down 0.1 percent to USD15,600 and tin eased 0.5 percent to USD52,950.