This past week saw the price of copper rise following a severe drop in the prior session as investor attention shifted to constrained inventories outside the United States. This came despite lingering uncertainty over whether current demand levels can be maintained. On the London Metal Exchange, benchmark three-month copper gained 0.4% to trade at $12,796 per metric ton, recovering from a 1.6% decline recorded at the start of last week.
Despite this, prices remain below last week’s all-time peak of $13,407. Britannia Global Markets’ Head of Metals, Neil Welsh, explained in a note that while volatility continues to characterize the broader base-metals market, underlying supply tightness is still providing support.
Signs of near-term scarcity were evident earlier in the week when the premium for LME cash copper over the three-month contract surged past $100 per ton. However, that backwardation eased later in the week, with the spread moving into a $23.50 per-ton discount.
Commodity Market Analytics’ Managing Director, Dan Smith, said investor sentiment remained fragile amid heightened geopolitical tensions following threats by U.S. President Trump to introduce tariffs on European allies resisting his push to assert control over Greenland. Commenting on copper’s rebound, which saw prices climb by as much as 1.6% in early trading, Smith expressed caution.
He noted that his quantitative models had turned bearish, suggesting the rally may lack durability and adding that any upside move looks vulnerable and likely to fade quickly. Elevated prices are also beginning to weigh on demand in China, which is the largest metals consumer in the world.
The Yangshan copper premium, a key indicator of Chinese import demand, slipped to $22 per ton. This marks its lowest level in nearly a year and a half. While the East Asian country’s broader economic indicators remain relatively robust, Smith warned that persistently high copper prices can suppress consumption.
At the end of 2025, China exported 96,000 tons of refined copper, roughly a third lower than November’s unusually strong volumes, but still over 5 times higher than exports recorded during the same period last year.
Tin led advances on the London Metal Exchange, climbing by over 3% to reach $51,000 per ton. This comes after Indonesia intensified efforts to curb illegal mining activity. Nickel also posted strong gains, rising to $17,995, which represents a 2.3% increase. Other metals that posted gains include zinc and aluminum, which rose by 0.2% and 0.5% respectively, hitting $3,178.50 and $3,124.
Lead was the only metal in negative territory, slipping to $2,024 per ton. The underlying concerns about copper supplies are likely to serve as tailwinds for exploration companies like Collective Mining Ltd. (NYSE American: CNL) (TSX: CNL) that focus on this and other metals.
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