Copper prices jumped initially and then pulled back. Pay attention to risk control. [Institutional Commentary]

Published: Mar 27, 2025 09:15

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On Wednesday night, LME copper closed at $9,907/mt, down 1.86%, while SHFE copper closed at 81,520 yuan/mt, down 1.08%. The most-traded contract saw a reduction of over 8,000 lots. The news that the US President might impose tariffs on copper earlier than expected pushed copper prices to a new high, though they pulled back slightly during the night. The wide price spread continued to drive active arbitrage trading, accelerating the concentration of copper resources in the US market. Additionally, two industry insiders revealed that Glencore declared force majeure on copper shipments from its Altonorte smelter in Chile, which has suspended production. Domestic copper supply faces concerns over reduced imports and resource outflows, coupled with worries about production cuts at smelters. The destocking during the peak season provides some fundamental support for copper prices, but attention is still needed on the potential weaker-than-expected demand during the peak season and the negative feedback from high prices, which could exert pressure on copper again. SHFE copper is expected to fluctuate upward, with continued focus on the implementation of US tariff policies, vigilance against overseas market squeeze risks, and attention to risk control.

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