Copper price recovers, but the physical market is still well supplied – Commerzbank

The Copper price can make up further ground after the Easter break. Recent statements from the ranks of the US government regarding a possible de-escalation of the tariff dispute with China should ensure that the recovery can possibly continue for a while longer, Commerzbank’s commodity analyst Carsten Fritsch notes.

Copper rebounds on trade hopes

“This is because hopes are likely to grow that the currently high tariffs between the two economic powers will soon be lowered again, which would minimize the damage to both economies. However, in view of the fundamental situation, we remain cautious about the further upward potential of the Copper price.”

“According to the International Copper Study Group (ICSG), the global Copper market was recently still adequately supplied. The supply surplus totalled 150 thousand tons in January and February, with a small deficit of 49 thousand tons on a seasonally adjusted basis. Compared to the same period last year, the supply situation has hardly changed.”

“This is surprising given the fears of a shortage of Copper ore, which could lead to a reduction in metal processing. However, both metal processing and demand remained relatively stable compared to the previous year. This could still change. This is because the US tariff dispute could affect metal processing in China, the dominant producer country, as well as reduce global demand.”