Copper Market Holds Steady as Surplus and Tariff Fears Dominate Trade

Official sources and trading charts confirm copper prices remained rangebound over the last 24 hours, as the market balanced persistent supply surpluses against ongoing tariff uncertainty.

On June 16, 2025, the LME cash settlement price stood at $9,779 per tonne, with inventories at 116,850 tonnes. COMEX copper closed at $4.8645 per pound, up 1.14% from the previous session, marking the highest close since late April.

These prices reflect a market that has moved little but remains sensitive to both macroeconomic and fundamental pressures. The International Copper Study Group forecasts a global surplus of 289,000 tonnes in 2025, more than double last year’s figure.

This surplus results from increased mine output, particularly in Africa, Mongolia, and Russia, and subdued demand growth in Western economies. Meanwhile, US inventories reached their highest levels since 2018, with traders stockpiling ahead of possible tariffs.

Citigroup projects a 25% US tariff on copper imports could arrive before Q4 2025, but buyers have already begun accumulating metal, pushing up local inventories and narrowing the premium over LME prices.

China’s situation contrasts sharply. Shanghai exchange inventories have dropped rapidly, with official data showing a 67% decline in just ten weeks. This drawdown reflects robust demand from the energy transition and infrastructure sectors, even as the Shanghai premium has softened.

Experts attribute much of the market’s recent tightness to this divergence: Chinese buyers continue to draw down stocks, while US warehouses fill in anticipation of trade barriers.

Technical analysis of the daily and four-hour charts confirms the market’s indecision. On the daily chart, copper trades above a key support at $4.83, with resistance at $4.88 and $4.92.

The 50-day and 200-day moving averages converge tightly, showing no clear trend. The Relative Strength Index (RSI) sits at 52.4, indicating neutral momentum.

Bollinger Bands have narrowed, signaling reduced volatility and a likely breakout ahead, but no direction is yet apparent. The MACD remains flat, confirming the absence of strong momentum.

The four-hour chart shows a mild downtrend, with prices making lower highs since June 10. The RSI at 48.6 and a negative but flattening MACD histogram suggest waning bearish momentum.

Price action repeatedly tests the $4.83 support but fails to break decisively lower, while rebounds stall at $4.85–$4.86. ETF flows in the commodities sector remain muted, with no significant copper-specific inflows or outflows reported.

This lack of conviction mirrors the market’s broader uncertainty. Analysts point to the risk that, once tariffs are implemented, US demand may soften, potentially reversing the current inventory build.

Macroeconomic factors remain central. While global mine supply grows, demand in China stays strong, driven by green energy and infrastructure. Yet, trade tensions and the threat of tariffs weigh on sentiment, capping price gains and encouraging defensive inventory strategies.

In summary, copper’s price action over the last day reflects a market caught between surplus-driven pressure and pockets of resilient demand.

The technical setup remains neutral, with traders watching for a catalyst—likely from trade policy or a shift in Chinese demand—to break the current stalemate.

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