The red metal’s forward curve remains in contango after flipping from backwardation last week, with LME copper’s benchmark cash/three-month spread recently trading at $6 per tonne contango.
Yet tight spreads over most of the summer period did little to prompt copper inflows back to the exchange, with total LME on-warrant copper stocks trending lower and nearing levels last seen in 2005.
Total LME on-warrant copper stocks now stand at 60,400 tonnes, after some 30,375 tonnes was delivered into Rotterdam sheds, where a total of 42,525 tonnes now sits on-warrant.
“China is about to enter its National Day holiday and of course the await the results of the congress later in October where President Xi is expected to announce another raft of initiatives to stimulate the massive Chinese economy and at the same time reducing its dependence on trade with America and boosting trade with the rest of the world,” Kingdom Futures director and chief executive Malcolm Freeman said in a morning note.
“This is from a nation that consumes over 40% of the global copper market, and it most certainly is not going to slow down,” he added.
Elsewhere in the complex, the three-month tin price was the standout performer over the morning trading session, pushing 1.6% higher and recently trading at $17,225 per tonne, while turnover was high at some 149 lots exchanged as of 10.30am London time.
Tin’s price action also recovered from slipping to a low of $16,990 per tonne overnight, but remains a long way from the $18,000-per-tonne trading levels seen earlier this month.
This comes despite a steady increase in LME tin stocks, with total on-warrant LME stocks pushing to 5,260 tonnes today – up from 4,945 tonnes at the start of September – after a fresh inflow of 130 tonnes was delivered into Port Klang, Malaysia, this morning.
Forward trade for the metal remains supported by a widening front curve, with LME tin’s cash/three-month spread recently trading at $34 per tonne contango, widening from $6 per tonne contango a fortnight ago.
- In other commodities, Brent crude oil futures were down by 0.36%, recently trading at $42.08 per barrel.
- The West Texas Intermediate (WTI) oil price was recently at $39.89 per barrel, a decline of 0.32%.
- The US dollar index was recently trading at 94.38, down by 0.22% but continuing to trend higher.