Copper holds loss as deliveries to LME mitigate supply crunch

Copper held the biggest loss in more than three weeks after traders made significant deliveries of the metal to London Metal Exchange warehouses, easing a historic squeeze.

Readily available copper inventories tracked by the LME jumped the most since April, adding more than 20,000 tons on Tuesday. Trafigura Group was behind a significant share of the metal, Bloomberg News reported, while other traders were also arranging to bring copper onto the exchange.

Benchmark three-month copper futures on the LME fell as much as 0.5% before paring losses to trade at $13 976 a ton as of 11:02 a.m. in Shanghai. That followed a decline of 1.2% on Tuesday, which was the biggest one-day drop since July 23.

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The arrival of copper in LME warehouses relieves some pressure after stockpiles with the bourse were drained by a surge in shipments to the US. That crunch was driven largely by an arbitrage trade in anticipation of import tariffs, but a deadline for the US Commerce Department’s recommendation to President Donald Trump passed in June with no announcement from the White House.

In another sign the supply crunch was easing, the closely watched spread between copper for immediate delivery and metal delivered three months out dropped to $248 a metric ton Tuesday from a backwardation of as much as $545 on Monday. Another key one-day price spread known as Tom/next also fell, after spiking to levels last seen during a major squeeze in 2021.

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