Copper Forecast to Defend Current Price Levels in the Near Term

SEATTLE (Scrap Monster): The prices of copper are most likely to stay firm around levels of $10,000 per tonne in near short term. This is mainly due to record low copper inventories on account of ongoing production cuts in Europe and China due to power crisis. Incidentally, the LME copper stocks hit a 47-year low on LME and a 14-year low in Shanghai. It must be noted that cash quote for the metal stood at $10,500 per tonne on the London Metal Exchange (LME) during this weekend.

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According to Fitch Solutions, the tightness in global copper inventory level will likely ease only a tad during the current quarter. This is mainly on account of lower Chinese refined copper supply. It noted that increasing number of Chinese smelters is seen halting production on account of power crackdown by Chinese administration, in a bid to reduce emissions from production facilities.

The latest data released by the International Copper Study Group (ICSG) indicates that world copper mine production surged nearly 5% in the initial half of 2021. The easing of Covid-19-related restrictions resulted in boosted output since June this year. Meantime, refined copper output increased by 3.2% during this period, with refined copper usage rising by 3.8%. The study group signals “essentially balanced” copper market.