LME copper inventories fall below 100,000-tonne threshold
Published by:Julienne Raboca<>
1 Jul 2025 @ 12:04 UTC

London Metal Exchange copper stocks continued to be drawn down on Tuesday, July 1, falling below the 100,000-tonne mark, while supply concerns supported prices despite technical resistance at $9,900 per tonne. At the same time, three-month base metals prices were mixed on Tuesday morning, with market trends shaped more by technical resistance levels than by any broad-based movement, observers said. The copper price reached $9,947.50 per tonne, while aluminium tested resistance at $2,600 per tonne and zinc weakened, erasing Friday’s gains.
These were the three-month futures prices at 9:27am on Tuesday compared with Monday’s 5pm close: • Copper: $9,947.50 per tonne, up by 0.79% • Aluminium: $2,609.50 per tonne, up by 0.46% • Nickel: $15,220 per tonne, up by 0.03% • Zinc: $2,727.50 per tonne, down by 0.88% • Lead: $2,045 per tonne, unchanged • Tin: $33,795 per tonne, up by 0.23%
Copper: all eyes on supplies LME copper inventories continue to be drawn down, falling below 100,000 tonnes in registered warehouses. Spreads are showing signs of stabilizing, with the cash-to-three-month spread steady at a backwardation of $181.69 per tonne, indicating reduced volatility, though supply concerns remain in focus.
The COMEX/LME arbitrage remains wide at $1,450 per tonne, indicating a potential lag in COMEX compared to LME, Daria Efanova, head of research at commodities broker Sucden Financial, said.
The copper spreads remain tight while drawdowns continue across both the LME and Shanghai Futures Exchange, being more than offset by builds being seen on COMEX.
“With no news on possible US copper tariffs out, we think copper spreads will remain tight and elevated,” Edward Meir from Commodity Research Group said.
“Inventory drawdowns on the LME should also contribute to the tightness, as traders ship LME metal into Asia while taking units off Shanghai Futures Exchange as well, just as they divert their more tariff-friendly copper units into the US market,” Meir added.
“Easing trade concerns and positive economic data helped boost sentiment across industrial commodities,” Daniel Hynes, senior commodity strategist at ANZ, said. “Copper was steady after better-than-expected economic data in China eased hopes of further stimulus measures. Factory activity and construction had their strongest month of the second quarter in June.”
The official manufacturing purchasing managers’ index (PMI) remained in contractionary territory but rose from 49.5 to 49.7, exceeding market expectations. Among factories, the new orders index expanded for the first time in three months, suggesting the pause in US tariffs on China has led to a rebound in trade.
The official manufacturing PMI from China, compiled by the National Bureau of Statistics, measures the health of the country’s manufacturing sector, with a reading below 50 indicating contraction.
“Signs of easing tightness in supplies also weighed on sentiment in the copper market,” Hynes said. “Chile posted its best month of copper production this year, with the world’s biggest producer churning out 486.6 kilotonnes. That was up 9.4% from the same month last year.”
Aluminium developments Meir noted that LME pricing remained fairly restrained on Monday, with modest declines seen across the board, apart from aluminium and lead which were both up slightly.
“But these modest changes are camouflaging the rather significant volatility we continue to see in the spreads and physical premiums,” he said.
Aluminium breached $2,600 per tonne amid inventory builds. The aluminium cash/three-month spread on the LME moved to $0.93 per tonne contango at Monday’s 5pm close, after being in backwardation the previous session.
“The aluminium forward curve should soften further as the LME implements tighter restrictions on a large single warrant holder,” Andy Farida, base metals research analyst at Fastmarkets, said. “A summer melt-up in the LME base metals prices seems like a low probability call.”
Zinc retreats The three-month zinc dropped by 0.88% to $2,727.50 per tonne on Tuesday morning, giving back gains made in the previous session – further weakening from Monday when it erased Friday’s gains.
At the same time, zinc’s sister metal lead is hovering just below the key resistance level of $2,050 per tonne, closing at $2,045 per tonne, while nickel is holding steady at $15,215 per tonne.