Middle East situation sees repeated tug-of-war; LME and SHFE copper edge higher in night session [SMM Copper Morning Comment]

Published: Sep 3, 2026 08:52

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SMM, September 3: Overnight, LME copper opened at $14,127/mt and dipped to $14,102.5/mt early in the session. The center of copper prices then moved sharply higher, reaching $14,292.5/mt, before drifting lower and finally closing at $14,236.5/mt, up 0.31%. Trading volume rose to 22,700 lots, and open interest to 268,600 lots, an increase of 3,229 lots from the previous trading day, indicating bulls added positions. Overnight, the most-traded SHFE copper 2610 contract opened at 108,500 yuan/mt and fell to 108,310 yuan/mt early in the session. The center of copper prices then moved sharply higher, hitting 108,760 yuan/mt, before drifting lower and finally closing at 108,390 yuan/mt, up 0.26%. Trading volume rose to 28,300 lots, and open interest to 206,000 lots, down 876 lots from the previous trading day, indicating bears reduced positions. On the macro front, regarding the Middle East situation, Trump said he was ready to strike Iran again at any time but denied pushing for talks; his aides, under election pressure, advocated handling the conflict in a “low-profile” manner, while Iran’s parliament speaker stressed that the strait would be reopened only after the US fulfills its commitments. US ADP employment in August increased by only 38,000, below expectations. Williams said interest rates were appropriate, and the Beige Book showed the overall economic outlook improved, but uncertainty rose somewhat. The US dollar index closed lower, providing some bullish support to copper prices. On the fundamentals front, supply side, imported cargo arrivals combined with position shifting and contract rollover demand prompted suppliers to actively sell, leaving overall supply marginally looser. Demand side, after copper prices pulled back, some downstream players bought the dip, but overall demand remained dominated by rigid demand, with limited improvement. Overall, copper prices are expected to consolidate on a subdued note today.

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