LONDON: Copper prices rose on Monday, supported by a weaker dollar, lower oil prices and a downgrade to Chile’s copper production outlook, though investors remained cautious ahead of Tuesday’s US midterm elections.
Benchmark three-month copper on the London Metal Exchange was up 0.6 percent at USD14,240 a metric ton in official open-outcry trading. The dollar eased and oil prices fell after talks between Iranian and Qatari officials aimed at pushing for a deal to end the US-Israeli war on Iran.
Brent ended October at its highest in six months on concerns that tensions could flare again after the US midterm elections. Meanwhile, copper inventories in LME-registered warehouses rose to 293,775 tons, their highest since mid-July, after 20,500 tons were delivered in New Orleans, daily exchange data showed.
“The only deliveries we’ve seen onto the LME stocks have been in the US and, arguably, material held there is not having the same impact on the curve as it would if deliveries had been made in Europe or Asia,” said Morgan Stanley analyst Amy Gower. “The market is treating US stocks as largely unavailable for now.”
Traders have been shipping copper to Comex-approved warehouses in the US since President Donald Trump ordered a study into potential copper tariffs in February last year.
While incentives to move metal to the US have diminished as tariff uncertainty drags on, the risk remains high enough to keep inventories there, with some material also flowing into LME warehouses in the US.
On the supply side, Chile’s copper commission, Cochilco, sharply lowered its forecast for the country’s copper production this year and forecast a more modest 2027 recovery than previously expected. Chile is the world’s largest copper producer.
Among other LME metals, aluminium lost 0.3 percent to USD3,059.5 a ton in official activity, zinc rose 0.4 percent to USD3,859, lead fell by 0.5 percent to USD1,901 while tin added 0.9 percent to USD49,300 and nickel gained 1.4 percent to USD15,480.