(Bloomberg) — Copper extended gains above $14,000 a ton, inching toward a record high seen earlier this year, as supply risks mount on mine disruptions around the world.
The red metal rallied for an eighth session to touch $14,196.50 a ton on the London Metal Exchange, close to an all-time high of $14,527.50 in January.
A squeeze on Middle Eastern supplies of sulfur has threatened the production outlook for some mines in Africa, compounding existing disruptions at other major sites across the world.
However, copper demand is resilient mostly thanks to the world’s biggest user China, which has seen robust consumption from power grids, renewable energy and artificial intelligence sectors.
The slew of supply issues combined with solid demand is leading industrial metals to recover notably as worries over the Iran war ease, according to Li Xuezhi, head of research at Chaos Ternary Futures Co.
Copper futures on New York’s Comex jumped to a record of $6.69 a pound, widening their premium to LME copper above $500 a ton in anticipation of the US imposing tariffs on refined metal imports. The potential duties have the effect of luring refined copper into the US and draining supplies elsewhere.
The US Commerce Secretary is due to deliver an updated report on the domestic copper market by June 30, part of a broader push to bolster supplies of a metal critical to growing electrification around the world.
Meanwhile in China, worsening raw material shortages at mines have started to affect refined metal output.
Refined copper output stood at 1.05 million tons in April, down 3% from March, after concentrate treatment charges plunged further and invoicing restrictions tightened supply of scrap as feedstock, according to Beijing Antaike Information Co. Production may drop further in May due to maintenance at smelters, it added.
Copper rose 0.5% to $14,099 a ton as of 11:06 a.m. in Shanghai. Other base metals were also higher, with aluminum up 0.3% to $3,574 a ton and tin climbing 0.5% to $55,070.
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