Copper Market Finds Support After Volatile Week

TradingView data shows copper prices stabilizing this morning at C4.74705, down slightly by 0.18% amid mixed global signals. Shanghai copper futures gained 0.3% to 76,040 yuan ($10,421.58) per ton as markets react positively to easing US-China trade rhetoric.

This recovery follows last week’s volatility when copper entered bear market territory with a dramatic 20% decline from March peaks. President Trump stated yesterday he does not plan to increase tariffs on Chinese imports.

His comments reassured markets that had reacted negatively to earlier White House statements suggesting potential 245% tariffs on some Chinese goods.

China reportedly seeks clearer policy direction and a designated US negotiator before advancing trade discussions further. Federal Reserve Chair Powell continues to influence market sentiment with recent statements.

He warned that tariffs could worsen inflation and hamper economic growth while reiterating the Fed remains “in no rush to cut interest rates.” These monetary policy signals contribute to copper’s price consolidation around current levels.

Physical market fundamentals show tightening supply despite macroeconomic headwinds. LME warehouse stocks stood at 216,250 metric tons as of April 16. This represents a continued downward trend from February when inventories topped 260,000 tons.

China’s central bank injected 250.5 billion yuan through seven-day reverse repurchase agreements at 1.5%. Chinese economic data provides further support for copper demand.

Copper Prices Rise Amid Economic Growth

The country’s economy grew by 5.4% in Q1 2025, exceeding analyst estimates. March refined copper production increased 8.6% year-on-year to 1.25 million metric tonnes.

Citi has softened its short-term bearish outlook on copper. The bank raised its three-month forecast to $8,800 per tonne from a previous $8,000 estimate following Trump’s recent tariff announcements.

For Q2 2025, Citi projects copper prices to average around $9,000 per tonne. Technical analysis from Eddie Topic at ADM Investor Services identifies key price levels.

The copper market shows a “bearish Andrews pitch hook with prices resting just above the middle time currently at 9132.” Topic notes the upside remains capped by the 38.2% Fibonacci line at 9256 and identifies three overhead congestion areas.

The premium between US copper futures and LME prices widened significantly to $955 per ton from $572 last week. This spread reflects concerns about potential supply disruptions and stimulates stockpiling activity in American warehouses.

Trading activity remains subdued today. LME copper trading has been temporarily halted, making transactions difficult to price. Market observers expect volumes to remain light heading into the weekend before picking up next week when clearer trade policy signals might emerge.

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