Copper prices fell in overnight trading as rising LME warehouse stocks eased immediate supply concerns and renewed Middle East tensions pushed oil prices higher. Volume was 35,000 lots, while open interest rose by 129 lots to 262,000, a pattern associated with increased short positioning. Its open interest dropped by 6,982 lots to 130,000, indicating reduced long exposure.
About 62% of exchange stocks were in U.S.
China’s physical market showed the opposite inventory direction. Copper stocks in major Chinese regions fell 21,500 tons from the previous Thursday to about 90,000 tons, roughly half the level recorded a year earlier. Shanghai social inventory was 51,100 tons, down 8,200 tons, while Jiangsu inventory was 21,200 tons, down 2,000 tons. Limited domestic arrivals and slower import replenishment supported Shanghai spot premiums, with #1 copper quoted at 600–820 yuan a ton over the SHFE 2611 contract and averaging 710 yuan. A backwardation of 660–710 yuan between the front and next contracts, together with import losses of roughly 350–440 yuan, raised procurement costs for buyers.
Some downstream processors continued to purchase only as needed, while high premiums and the steep backwardation limited broader spot-market absorption. Expected typhoon conditions also led some vessels to shelter, creating a possible short-term disruption to imported-copper arrivals. Copper scrap prices fell 200 yuan, and the cathode-to-scrap price gap narrowed to 1,896 yuan, encouraging some secondary-copper-rod producers to buy after the pullback while traders remained reluctant to sell at lower prices. The combination of higher energy costs, inflation pressure and the divergent inventory picture left copper vulnerable to further consolidation in a narrow, subdued range.