Copper Consolidates Near $4.73 as Global Supply Tightness Persists

Copper futures traded at $4.7289 per pound early Thursday, showing a marginal decline of 0.08% from the previous close.

The industrial metal has established a consolidation pattern after recovering from Wednesday’s volatility, according to the latest market data published on TradingView.

The London Metal Exchange saw copper stabilize overnight following a mixed Wednesday session. LME copper opened at $9,542.5 per metric ton yesterday before fluctuating downward to $9,487, eventually settling at $9,504.

This morning, three-month copper contracts have edged higher to $9,509.5, reflecting modest overnight gains as Asian markets responded to developments in China.

Chinese demand remains resilient despite broader economic concerns. The Yangshan premium, which measures Chinese import appetite, hovers near 16-month highs at $94 per ton.

This premium jumped dramatically from $35 in late February, signaling persistent tightness in the physical market. LME warehouse stocks have decreased steadily to 168,825 tons as of May 21, marking a one-year low.

About 40% of remaining inventory awaits physical load-out. The cash-to-three-month spread has shifted into backwardation at $14.01 per ton, indicating near-term supply constraints in the European market.

Meanwhile, COMEX inventories have built significantly in recent months. U.S. stockpiles reached eight-year highs as traders positioned ahead of potential tariffs. The tariff premium has consequently fallen from nearly $1,600 per ton three weeks ago to approximately $600 currently.

Technical analysis of the copper chart shows prices have lost their negative momentum. The metal currently finds support at the $4.50 level, reinforced by stability at the 55-day moving average.

Trading appears confined between support at $4.50 and resistance at $4.66, with a breakthrough likely determining the near-term trend. Global copper mine output is projected to reach 23.2 million tonnes in 2025, representing just a 3% increase from 2024 levels.

This modest growth stems from capacity expansions in Chile, the Democratic Republic of Congo, and China. Chinese stimulus measures continue supporting copper demand despite slowing growth projections.

The People’s Bank of China recently cut key lending rates, signaling ongoing support for factory activity. However, manufacturing data has been mixed, with key Chinese indicators suggesting contraction amid growing trade tensions with the U.S.

Year-to-date, copper has shown strong performance, increasing 17.14% since January. The metal reached an all-time high of 168.72 in March 2025, reflecting the ongoing tension in global markets driven by supply constraints and geopolitical factors.

Traders will closely monitor inventory movements, Chinese demand signals, and developments in U.S.-China trade relations that could impact the copper market’s delicate balance as trading progresses today.

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