Key Moments
- Copper prices remain supported by tight physical markets in China. Refined metal import premiums have jumped to $100/t from $20/t in late January.
- Scrap shortages, Beijing’s invoice trading crackdown, and smelter maintenance have reduced Chinese supply. Meanwhile, domestic and LME inventories remain low.
- LME copper traded near $13,600/t on Monday. Prices are up about 9% this year, although growth concerns and Fed risks may limit further gains.
China Drives Tightness in Physical Copper Market
ING Commodities Strategists Warren Patterson and Ewa Manthey say copper prices are gaining support from tighter physical conditions in China. The Yangshan copper import premium has risen to $100/t, its highest level in more than a year. This marks a sharp increase from $20/t in late January. The move shows stronger demand for refined copper as scrap shortages push buyers toward imports.
Meanwhile, Beijing’s crackdown on invoice trading has disrupted scrap flows. As a result, domestic copper supply has tightened further. In addition, maintenance outages at several Chinese smelters have reduced refined production.
Low Inventories Support Copper Prices
China’s copper inventories are now near the lower end of their normal seasonal range. At the same time, London Metal Exchange (LME) stocks have dropped to their lowest level since March. More metal is flowing into China as buyers respond to tight local supply.
| Market Indicator | Current Situation |
|---|---|
| Yangshan copper import premium | $100/t (up from $20/t in late January) |
| Chinese copper inventories | Near the lower end of the seasonal range |
| LME copper inventories | At the lowest level since March |
Copper Gains Face Macro Risks
Copper has also benefited from expectations of possible US tariffs. During Monday’s session, LME copper traded near $13,600/t. The price is now around 9% higher compared with the start of the year.
Overall, tight inventories, strong import demand, and falling exchange stocks point to a supportive outlook for copper. However, risks remain. Concerns about global growth and uncertainty over Federal Reserve policy could slow further price increases.
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