Copper Prices Skyrocketed Due To Declining Stocks

Copper prices skyrocketed due to declining stocks. Copper rose above the level of 10 thousand dollars per ton.

Freely available inventories in the LME have fallen 89 percent this month after orders to pull copper from warehouses in Europe rose strongly. Inventories also fell sharply on competing exchanges and private sector warehouses, with price differentials between LME contracts reaching historic backwardation levels, with near-term contracts trading at very high premiums. Copper rose 1.1 percent to $10,090 in the LME, hitting its highest level since June 11. Decreased global stockpiles and strong demand for copper are offsetting growing concerns about the macroeconomic outlook and the risk of stagflation and electricity shortages impacting growth. Earlier on Friday, the contract, which expires one day earlier than the other, traded at a premium of $175 over the previous contract, well above previous peaks seen during short-term supply squeezes in recent years. This means the biggest 'backwardation' considering the data going back to 1998. That premium stood at $1 at close of Monday.