Copper closed Tuesday just below its all-time high, extending its winning streak to six sessions as Chinese buyers restocked ahead of back-to-back holidays and warehouse inventories in Shanghai and London continued to drain.
Three-month copper on the London Metal Exchange settled at $14,783 a metric ton, up 0.8%, according to Shanghai Metals Market, leaving it $92 short of the $14,875 record set Sept. 10. Comex copper for December delivery hit $6.871 a pound in New York during the session, within 2 cents of its $6.8885 record settlement from Sept. 9. The run is copper’s longest in four months, Bloomberg reported.
That puts the metal close to erasing the selloff from two weeks ago, when a Reuters report that the White House’s copper tariff plan had stalled over affordability concerns knocked more than 5% off U.S. prices in a single session. This leg higher has little to do with Washington, though. It’s being driven by physical metal getting hard to find in China.
Copper cathode stocks in Shanghai fell to 43,900 tons last week, the lowest since 2023, according to SMM data. Inventories in Shanghai Futures Exchange warehouses are down 70% since early June, and imported cargoes that do arrive are going straight to fabricators instead of into storage, Mining.com reported. Spot cathode in Shanghai commanded an average premium of 1,375 yuan a ton over SHFE futures on Tuesday, up 550 yuan in a single day.
Buyers are front-loading purchases before Chinese markets shut Friday for the Mid-Autumn Festival and again Oct. 1-7 for National Day, and several domestic refineries have maintenance scheduled for October and November. “Copper is finding support from tightening physical market conditions in China,” ING commodities strategist Ewa Manthey told Reuters, adding that falling inventories and seasonal restocking are offsetting a firmer dollar.
In London, cash copper settled at a $62 premium to the three-month contract on Monday, flipping from an $86 discount a week earlier, a sign buyers want metal now. Cancelled warrants, metal booked for withdrawal, climbed to 122,150 tons on Tuesday, nearly half of all on-warrant stock, leaving just 133,725 tons actually available to the market.
The U.S., by contrast, is sitting on a pile it can’t easily move. Comex warehouses hold about 696,000 tons, roughly 69% of all exchange-monitored copper, after a year of importers rushing metal in ahead of tariffs that still haven’t materialized. Those stocks slipped last week for the first time since April, and New Orleans, the main Comex delivery hub, is 82% full with another 100,000 tons due by the end of October, according to SP Angel. That imbalance has been draining metal from the rest of the world for months.
On the supply side, Sprott Asset Management said over the weekend that global mined output could fall this year for the first time since 2017, with outages at Freeport’s Grasberg mine in Indonesia and Ivanhoe Mines’ Kamoa-Kakula in Congo stripping about 600,000 tons from expected 2026 production. Chile could add to that. BHP faces a Wednesday deadline to present its final offer to a union of roughly 1,020 supervisors and staff at Escondida, the world’s largest copper mine, whose contract expires Sept. 30, SMM reported. A rejection would send talks to government mediation before any strike, but Escondida’s output already slumped 22% in July.
LME copper is up 18% this year and Comex prices are up 21%. It’s gained roughly 70% since its April 2025 lows, according to Bloomberg data, as demand from grids and AI data centers outruns mine supply. Veteran commodities strategist Jeff Currie has argued repeatedly that the “physical economy is repricing scarcity in the real world.”
Robert Montefusco at broker Sucden Financial isn’t convinced the rally has much room left. “I think it’s a little bit inflated up here,” he told Reuters, warning that Chinese producers could start selling if prices climb further. Bloomberg Intelligence’s Mike McGlone has cautioned that a broader market correction could shave 20% to 30% off copper.
The Federal Reserve’s quarter-point hike last week, its first since 2023, is still weighing on industrial metals, and traders are waiting on this week’s meeting between President Donald Trump and Chinese President Xi Jinping for trade signals. With China about to go quiet for the holidays, whatever comes out of that summit could decide whether copper takes out its record before Beijing gets back to work.
