Copper Prices Decline As Rising Inventories Ease Concern Over World Metal Supply
Kedia Advisory -
Copper settled 0.59% lower at Rs 1,390.4 as rising inventories and easing supply concerns weighed on prices despite record premium offers from producers for physical deliveries in 2027. London Metal Exchange inventories increased by 11,475 tonnes, gaining 8% in a week, while available stocks rose 40%, indicating improved near-term availability. Shanghai Futures Exchange copper inventories also increased by 25.9% from the previous Friday. However, regional tightness outside the United States continues to support physical premiums, with Chilean state miner Codelco offering customers a record premium of $350 per tonne over LME prices for 2027 deliveries. Goldman Sachs raised its end-2026 copper price forecast to $14,700 per tonne and its 2027 average forecast to $15,400, citing weaker mine supply and tightening markets outside the United States. BHP reported a 19% decline in quarterly copper output to 400,700 tonnes following disruptions in Chile and Australia, while Antofagasta reported a 7% increase in third-quarter production and maintained its annual outlook after workers ended a strike at the Centinela mine.
China's copper imports rose 20.7% month on month to 461,000 tonnes in September, while refined copper production increased 1.1% year on year to 1.26 million tonnes. Meanwhile, the International Copper Study Group projected the global refined copper market to remain in surplus, with the surplus widening from 104,000 tonnes in 2026 to 368,000 tonnes in 2027. Refined copper production is expected to grow 3.4% in 2027, supported by new smelting and refining capacity, while usage is forecast to increase 2.5%, driven by manufacturing, renewable energy, electrification, data centres and artificial intelligence. Mine production is also projected to rise 3.1% in 2027, potentially limiting further price gains.
Technically, copper is witnessing long unwinding, with open interest declining 8.15% to 5,958 contracts alongside an Rs 8.25 price fall. Support is placed at Rs 1,382.50, followed by Rs 1,374.50, while resistance is seen at Rs 1,399.50, above which prices could test Rs 1,408.50.
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Conclusion for Businesses and Traders
Even though big banks like Goldman Sachs see higher prices down the road due to tight mine supply, the immediate market is dealing with growing warehouse stocks that are pushing prices down for now. Traders should keep an eye on support near Rs 1,382.50, while businesses needing physical copper can watch how global inventory levels shift before locking in future orders.