Copper isn’t just a clean energy play anymore — it’s turning into one of the most structurally bullish setups across the entire commodity space.
1. The Squeeze Is Real
LME inventories have collapsed this year — down over 60% — and the market’s flipped into steep backwardation. Treatment and refining charges have gone negative (yes, smelters are now paying miners). That only happens when physical supply is drying up.
It’s not a price spike — it’s a structural problem.
2. The U.S. Is Front-Running Tariffs
Traders are moving refined copper into the U.S. like it’s 2021 again. Imports just hit ~200k tons in April. Everyone’s bracing for Section 232 tariffs.
Meanwhile, China’s dealing with its own smelter headaches and India is sending geologists to Zambia. You don’t do that unless you’re worried about long-term access.
This isn’t a localized issue — it’s global.
3. The Supply Chain Is Tight — And Political
The U.S. wants supply security. China wants smelting capacity dominance. India wants to secure raw feed.
But the actual copper? Still coming from Chile, Peru, DRC… and very little new investment. Projects take years. Traders are already seeing it in spreads.
That’s why copper’s staying bid — even in macro chop.
4. What I’m Watching
- Spreads – Spot vs. 3-month LME is telling you everything. When it’s this backwardated, someone’s short real copper.
- U.S. premium – Tariff risk = arbitrage opportunity.
- Refining charges (TC/RCs) – Still crashing. Bullish signal.
- Smelter deals – Antofagasta just did a zero-fee deal with Chinese smelters. That’s rare. That’s real.
5. How I’m Thinking About It
I’m long copper through the volatility. This isn’t a fast money trade — it’s a grinding supply squeeze with a geopolitical tailwind. Add in green demand and U.S. onshoring, and you’ve got a setup that’s bigger than most people realize.
Any dips below $9,500/ton? I’m watching for adds. My eyes are on the $10,500–11,000 zone by Q3.
⚠️ Final Note
Copper is one of the few markets where traders and governments are chasing the same thing: control of physical supply. That makes price action noisy — but the trend loud.
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