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Informist, Tuesday, Mar. 25, 2025

By Ashutosh Pati

MUMBAI – Futures contracts of COPPER rose on the Multi Commodity Exchange of India, tracking a rise in contracts on the London Metal Exchange, because of weakness in the dollar. Market sentiment was boosted due to tight global supplies amid trade disruptions triggered by US President Donald Trump's tariff imposition on copper imports.

At 1644 IST, the Dollar Index, which measures the strength in the greenback against a basket of six major currencies, was down 0.2% at 104.10. A weaker dollar makes commodities such as copper, which are priced in the greenback, cheaper for buyers holding other currencies, hence, aiding demand.

"Major metals trader Mercuria warned that there is 500,000 tonnes of copper heading to the US. This compares with normal imports of around 70,000 tonnes per month. The shift in inventory (to the US) could leave the rest of the global market tight in the face of stronger demand in China," Daniel Hynes, senior commodity strategist at ANZ Research, said in a note.

Trump last month ordered the US Commerce Department to investigate the threat that copper imports pose to national security and suggest ways to mitigate any such threat. The mitigation efforts include "potential tariffs, export controls, or incentives to increase domestic production," the order said.

Meanwhile, Trump said on Monday he might soften the reciprocal tariffs he plans to impose on US trading partners next month, and that some nations might get exemptions. "That could limit the economic damage and therefore impact on copper demand," Hynes added.

Moreover, the global refined copper market was in a deficit of 19,000 tonnes in January. Copper inventories at warehouses registered with the LME have fallen 18% to 221,775 tonnes over the past four weeks, further supporting prices. Market participants are now waiting for the US Conference Board's consumer confidence, due later in the day for further cues.

ZINC prices rose, taking cues from the LME as inventories at LME-accredited warehouses fell by 3,425 tonnes to 476,625 tonnes. "Zinc also rose on news of smelter disruptions in China's Hunan province due to water contamination," Kotak Securities said in a report.

At 1713 IST, on the MCX, the March futures contract of:

-–ALUMINIUM was at INR 251.30 a kg, down 1.1%

–-Copper was at INR 905.00 a kg, up 0.4%

–-LEAD was at INR 178.95 a kg, up 0.1% 

–-Zinc was at INR 276.65 a kg, up 0.7%

Trading levels for the day on the MCX:

--Aluminium contract seen at INR 247.50-INR 256.50

--Copper contract seen at INR 893.60-INR 917.90

--Lead contract seen at INR 176.70-INR 180.90

--Zinc contract seen at INR 272.00-INR 281.60

End

US$1 = INR 85.75

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Subhojit Sarkar

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