Onome Amuge
Copper prices rose on Friday as signs of stronger Chinese demand helped offset profit-taking by traders and lingering uncertainty over the impact of U.S. monetary easing.
Benchmark three-month copper on the London Metal Exchange added 0.4 per cent to $9,980 a tonne, supported by restocking activity in China, the world’s largest metals consumer. The metal has retreated 2 per cent since touching a 15-month high of $10,192.50 earlier this week, as investors locked in gains after the U.S. Federal Reserve announced its first interest-rate cut of the year.
The Yangshan copper premium climbed 1.8 per cent to $57 a tonne on Friday, its highest in weeks. Analysts said the rise reflected buyers building inventories ahead of China’s week-long National Day holiday, which runs from October 1 to October 8.
The seasonal restocking has cushioned copper against a broader wave of profit-taking triggered by the Fed’s 25-basis-point rate cut on Wednesday. While lower borrowing costs often support industrial commodities by boosting growth expectations, traders instead used the event as an opportunity to sell after copper’s sharp rally.
Citi analysts said in a note that copper was likely to trade in a range of $9,500 to $10,500 in the final quarter of 2025. Beyond that, they forecast prices would climb towards $12,000 by 2026, underpinned by expectations of a weaker U.S. dollar and demand growth outpacing supply increases.
Citi projects that refined copper consumption will rise 2.9 per cent next year to 27.5 million tonnes, tipping the global market into a 308,000-tonne deficit. That compares with a surplus of 63,000 tonnes this year.
“Copper’s long-term bull case remains intact. Mine supply is struggling to keep pace with demand, particularly from the energy transition and electrification sectors, while refined consumption continues to expand steadily,” Citi said.
Copper, often dubbed “Dr Copper” for its reputation as a barometer of global industrial activity, has been supported by structural trends including investment in renewable energy, electric vehicles, and grid infrastructure. Analysts argue that these sectors will sustain demand growth even if traditional industrial uses remain more cyclical.
Trading in other LME metals was mixed on Friday, reflecting diverging fundamentals across base markets.
Aluminium slipped 0.5 per cent to $2,671 a tonne after touching a six-month high of $2,720 earlier in the week. The premium of the cash aluminium contract against the three-month contract had widened to $16 a tonne on Tuesday, its highest since March, before easing back to $5.
“Physical market conditions for aluminium remain broadly balanced,” Citi said. “Large positioning on the LME market is creating temporary volatility in spreads, but this has limited impact on the flat price.” The bank expects aluminium to average $2,650 in the fourth quarter.
Zinc dropped 1.1 per cent to $2,885.50 a tonne, despite sharp declines in inventories held in LME-registered warehouses. Stocks have slumped in recent months, pointing to tighter market conditions, but traders say physical availability remains comfortable.
Lead slipped 0.4 per cent to $1,997, while nickel eased 0.1 per cent to $15,260. Tin, used in electronics soldering, was the day’s strongest performer, climbing 1.2 per cent to $34,130.
