Copper Rises to Three-Month High on Supply Squeeze, Trade Hopes

(Bloomberg) — Copper (HG=F) rose to a three-month high on an ongoing supply squeeze and as risk sentiment improved due to optimism the US will reach trade deals with other major economies. Most Read

(Bloomberg) — Copper (HG=F) rose to a three-month high on an ongoing supply squeeze and as risk sentiment improved due to optimism the US will reach trade deals with other major economies.

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Spot copper contracts traded at steep premiums to those for later delivery, a market structure known as backwardation that indicates tight supply. There’s been a rapid drawdown in inventories on the London Metal Exchange and in China recently after traders moved record volumes to the US in a bid to front-run tariffs proposed by the White House.

The so-called Tom/next spread, the premium of copper due for delivery in one day to contracts expiring a day later, widened again on Tuesday after peaking at $98 a ton last week, the highest since 2021.

Copper rose 0.9% to $9,960 a ton on the LME as of 8:39 a.m. local time. It touched $9,984 earlier, the highest since March 27. Risk appetite was also aided after by a rise in stocks on hopes the US is moving closer to reaching deals with its top trading partners.

Zinc, meanwhile, fell 0.9% to $2,728 a ton as a buildup in Chinese inventories pointed to a tepid demand in the top consumer of the metal. Used mainly to galvanizing steel, zinc has dropped more than 8% this year. Mined supplies have risen at the same time as China’s ongoing property downturn and generally sluggish economy suppress demand.

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Copper Rises to Three-Month High on Supply Squeeze, Trade Hopes