**BREAKING: Copper Prices Supported by Chinese Supply Squeeze**
Copper prices are finding strong support as physical market conditions tighten significantly in China, according to ING Commodities Strategists Warren Patterson and Ewa Manthey. The Yangshan import premiums have jumped sharply, driven by acute scrap shortages and ongoing smelter maintenance outages across the country. This supply disruption comes as copper inventories in both Chinese warehouses and on the London Metal Exchange remain critically low, creating a supply-demand imbalance that’s underpinning price levels.
The physical tightness in the world’s largest copper consumer signals constrained availability just as industrial demand remains robust. Traders should monitor whether smelter operations return to normal capacity and if scrap supply improves in coming weeks. The combination of low inventories and supply constraints typically creates price volatility and upward pressure on the red metal.
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FXnCO Insight
** Long copper positions remain attractive on this supply tightness, but watch Yangshan premiums closely as any reversal would signal easing physical conditions and potential price weakness ahead.
Source: FXStreet