Market Overview

Copper settled 0.21% higher at ₹1,413.45 on the Indian market, driven by fading expectations of a U.S. Federal Reserve rate hike that outweighed the downward pressure from a firm U.S. dollar.

Supply Constraints in Chile

Chilean copper production in August dropped 12.8% year‑on‑year to 369,500 tonnes, marking the lowest monthly output since February 2011. The decline was compounded by labour unrest: workers at Antofagasta’s Centinela mine voted to strike, and supervisors at the Escondida mine rejected a collective‑contract offer, raising the risk of further disruptions.

Chinese Demand and Inventory Dynamics

China’s official manufacturing PMI for September rose to 50.1 from 49.8, while the private RatingDog PMI climbed to a five‑month high of 52.1 from 51.5, signalling stronger industrial activity. In the Shanghai Futures Exchange, copper inventories fell 17.8% week‑on‑week to 38,744 tonnes, the lowest level since January 2024, as pre‑holiday demand prompted withdrawals. The domestic physical premium eased to 1,050 yuan per tonne from 1,375 yuan, and the Yangshan import premium narrowed to $119 per tonne.

Forecasts and Market Positioning

Bank of America raised its 2031 copper price forecast by 20% to $13,577 per tonne, citing tightening supply outside the United States and persistent market tightness in China. On the COMEX, speculators reduced net long positions by 3,940 contracts, leaving 78,709 contracts long.

Global Supply‑Demand Balance

The International Copper Study Group (ICSG) reported a refined copper deficit of 51,000 tonnes in July, narrowing from a 74,000‑tonne deficit in June. Over the January‑July period, the market showed a 32,000‑tonne surplus compared with a 157,000‑tonne surplus a year earlier. China’s unwrought copper imports fell to 382,000 tonnes in August, and cumulative January‑August imports declined 6.7% year‑on‑year to 3.30 million tonnes.

Technical Outlook

Open interest rose 0.19% to 8,308 contracts, and prices gained ₹2.95. Copper finds technical support at ₹1,410; a break below could test ₹1,406.4. Resistance is positioned at ₹1,416.9, and a sustained move above this level could push prices toward ₹1,420.2.