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Informist, Monday, Aug. 3, 2026

 

MUMBAI – The supply deficit of copper in the market for the past few weeks has been aggravated by the deadly storms in Chile since last week, which have disrupted mining activities, media reports said. Chile accounts for more than a fifth of global copper production. Although immediate outages appear limited, this has hit a market that is already pressured by US tariff expectations, tighter scrap availability in China, and increasing demand for refined metals used in power grids and artificial intelligence infrastructure, CNBC reported, quoting strategists.

 

Flash floods, heavy snowfall, and high winds have swept across South American countries over the past week, killing 13 people and affecting operations run by major copper producers, including Anglo American, Antofagasta, Lundin Mining, and Codelco. Strategists have warned that any prolonged hit to Chilean output resulting from winter storms could add further upward pressure on prices.

 

"Copper enters August with supportive fundamentals," Reuters said, quoting ING commodities strategist Ewa Manthey. "The market is still facing a supply deficit and limited inventory buffers outside the US, leaving prices vulnerable to any further disruptions or signs of stronger demand," it added.

 

Nearly 64% of visible global copper inventories are held in the US. Speculation on the US tariff changes remains a major driver of price movement rather than physical demand, CNBC said, citing George Cheveley, natural resources portfolio manager at Ninety One Asset Management.

 

Available copper stocks in LME-registered warehouses fell 50% in July to 101,650 tonnes, the lowest level since mid-January as large volumes were earmarked for delivery, Kedia Advisory said in a note. On cues of nearby supply tightness, the premium of the cash LME copper was up at $40 per tonne over the three-month contract, its highest in seven months, the note added. 

 

However, in China, demand is seen to be fading as the Yangshan copper premium stabilises at $112 a tonne after hitting $115. Pressured by shrinking orders, China's factory activity unexpectedly slipped into contraction in July, weighing on overall market sentiment.  End

 

At 1056 IST, the three-month contract of copper on the LME was up 0.36% at $13,842.50 per tonne.

 

US$1 = INR 95.15

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

 

Reported by Krupa Biju

Edited by Deepshikha Bhardwaj

 

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