FX.co ★ Copper Extends Pullback from 4-Week High

Copper futures in the United States have declined to approximately $4.65 per pound, down from the four-week high of $4.82 observed on May 23rd. This shift is attributed to concerns over decreasing demand and newly evident supply inflows to North America. According to the International Copper Study Group, the copper market experienced a surplus of 289,000 tons in the first quarter, an increase from the previous year's 268,000 tons, driven by significant investments in South American mining operations. However, the backwardation of London Metal Exchange (LME) futures suggests a tight physical supply in the immediate future, as shipments to the U.S. were moved to preempt potential tariff measures proposed by U.S. President Trump. Trump has launched an investigation into copper imports, aiming to bolster the domestic industry and encourage the establishment of more smelting facilities within the country. Nonetheless, increased expenditure on data centers by technology companies has supported long-term purchasing, in line with the demand for copper in other electrification technologies.