Copper prices have come under significant pressure following a sharp increase in exchange inventories, according to ING commodities strategists Warren Patterson and Ewa Manthey [1]. Total LME copper inventories surged by 18,775 tonnes, reaching 330,375 tonnes, which marks the highest level since September 2019. The majority of these inflows were directed to Taiwan and Baltimore [1].
The rise in inventories has been attributed to weaker Chinese demand and reduced shipments to the US, as tariffs have slowed trade flows [1]. Additionally, speculative positioning in copper has softened, with net bullish bets falling by 284 lots to 32,788 lots. This represents the least bullish position since October 2023, indicating waning investor confidence in the metal [1].
The combination of rising stocks, weaker physical demand, and softening speculative sentiment has weighed heavily on copper prices, suggesting a bearish outlook for the industrial metal in the near term [1].
CONCLUSION
Copper prices are facing downward pressure due to a surge in LME inventories and weakening demand from key markets. The softening speculative positioning further underscores a negative market sentiment, indicating continued challenges for copper in the short term.