FX.co ★ Copper Holds Recent Losses

Copper futures in the United States dipped below $4.65 per pound on Wednesday, retaining most of the losses from the previous week due to signs of dwindling global demand and a substantial influx of copper into North American warehouses. Key manufacturing indices from China, the US, and Europe exhibited a downturn in factory operations within these crucial manufacturing zones, dampening the outlook for base metals demand. Simultaneously, robust ore production in South America has heightened the situation of oversupply. In fact, the International Copper Study Group has revised its surplus forecast for this year to nearly 300,000 tonnes, doubling its previous estimate. As a result, the escalating risk of a supply surplus has prompted Chinese traders to liquidate long positions in US copper futures, particularly after Trump's announcement of a potential tariff investigation on copper imports. This trend has run parallel with a steep rise in US copper inventories as companies redirected copper back into the US to safeguard against impending tariff risks.