Copper MMI Inches Up, Still a Fundamentally Bearish Story

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Our Copper MMI rose two points in September. Copper prices have remained range-bound in the between $4,500-$5,100 per metric ton for almost the whole year.

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Why did copper prices rise in September?

Pretty simple, because all base metals rose in September. Copper’s fundamentals still look pretty bearish and nothing relevant within the copper industry occurred in September. Investors bought copper as improving sentiment in the industrial metals complex is keeping each individual metal alive, even those without a bullish story, like copper.


In Q1, China’s copper imports were running at record levels, but over the past few months imports are coming down. In August, China imported 350,000 mt of unwrought copper and copper products. This is the fifth consecutive month that imports have declined on a monthly bases and the lowest figure in a year.

Rising Inventories

Now, as Chinese refined imports start to taper down, we are witnessing inventory build up in the London Metal Exchange‘s warehouse system. In September, LME copper stocks rose to 380,000 tons, the highest levels in more than two years.

Global production of copper concentrates rose by 6% in the first half and much of this abundance of raw material is going to China because it is where most smelter and refinery capacity is located. This means that if prices were to increase to attractive levels, China’s capacity would be able to absorb more raw material, increasing its refined copper exports.


Unlike other metals where we’ve seen supply disruptions, there is not much going on with copper. However, copper buyers need to keep an eye on those macro drivers that could move copper prices.

Two-Month Trial: Metal Buying Outlook

One of the drivers supporting copper prices is crude oil. Oil prices rose to near $50 per barrel this week. In September, the Organization of Petroleum Exporting Countries reached an understanding that a crude-oil-production cut is needed to lift prices. The cartel could start to tackle the supply in November, which might help lift prices in Q4, improving investors’ sentiment on metals too.

What This Means For Metal Buyers

While industrial metals continue to rise, we don’t expect copper prices to fall significantly. On the other hand, investors are still trying to find a good fundamental reason to get on copper and make prices finally take-off significantly.

Actual Copper Prices and Trends

The Japanese copper primary rose 4% to $5,032 per mt from the previous month. Indian copper prices increased 2% from $4.78 per kilogram to $4.89 per kg. Prices in China rose 1% to $5,697/mt. LME primary, 3 month-delivery copper finished the month at $4,846, up 5%.

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