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Copper prices boosted by falling stocks at LME warehouses

Copper prices boosted by falling stocks at LME warehouses
Copper prices boosted by falling stocks at LME warehouses

Prices of copper rose on Monday, as inventories in warehouses approved by the London Metal Exchange fell. The'market was looking forward to the U.S. announcement at the end of June regarding import tariffs on the metal. Benchmark copper on the?LME rose 0.7% to $13,610 per metric ton by 1602 GMT.

Sources in the industry said that traders and funds continue to take copper from the LME into the U.S., before any import duties are imposed. This would increase shipping costs significantly.

The U.S. flagged the possibility of 15% levies being imposed on copper imports starting in 2027, and 30% at the beginning of 2028.

Copper stocks, which now total 376,775, are down 6% in the last month. Around 39% of cancelled warrants and metal earmarked to be delivered indicate that another 145.800 are due to leave the LME system.

The discount on the three-month forward cash copper contract has also been reduced due to lower LME inventories.

The traders also cited the strong interest in buying copper from Chinese companies, following Friday's 3% decline to one-week-lows.

Copper's upside is capped by the 21-day moving?average, currently around $13,730. Support on the downside comes from the 50-day moving?average, around $13,260.

The Middle East, which houses 9% of the global aluminium capacity, is expected to keep its prices stable due to the U.S. vs. Iran war and the closing of the Strait o'Hormuz.

Aluminium prices are expected to rise due to higher energy costs, which is a major component of the aluminum process.

Industrial metals are generally under pressure due to concerns about growth caused by high oil prices and the conflict in the Middle East. The base metals are also being impacted by a higher U.S. dollar, which makes metals priced in dollars more expensive to holders of other currencies. Aluminium rose by?0.1% at $3,598 per ton. Zinc gained 0.2%, lead fell 0.8%, tin dropped 1.4%, and nickel slipped to $18,355. (Reporting by Pratima Dasai; Editing and re-reporting by Jan Harvey David Holmes Jonathan Ananda).

(source: Reuters)