The futures price of copper reached $6.60 per pound on Thursday, recovering from declines in the previous session. This price change has occurred due to supply disruptions in the world's largest copper producer, namely Chile.
Strike at the Centinela Project
Two unions at the Centinela project owned by Antofagasta began a strike on Wednesday, warning that this strike could impact production in the next two weeks. However, Antofagasta has maintained its production forecasts.
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Additionally, Chile recently announced that copper production in August fell to its lowest level since February 2011. This production decline could put more pressure on the copper market and affect prices.
Impact of U.S. Tariff Threats
The U.S. government has yet to make a decision regarding potential tariffs on refined copper. Previous tariff threats from the U.S. have forced traders to reroute shipments to American warehouses, contributing to the recent price increases.
On the other hand, copper consumption activities in the largest consumer of this metal, namely China, have stagnated due to a week-long national holiday. This situation could create opportunities for inventory replenishment in the coming weeks.
Overall, the production and demand situation in the copper market is always influenced by various factors that can lead to severe price fluctuations. With ongoing supply disruptions in Chile and uncertainty in U.S. trade policies, the copper market is likely to face more challenges in the near future.
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