LONDON: Copper and aluminium prices crept higher on Thursday as investors waited to see whether US President Donald Trump would follow through with his threat to impose tariffs this weekend. Three-month copper on the London Metal Exchange (LME) was up 0.3% at $9,098 a metric ton in official open-outcry trading while aluminium was a touch firmer at $2,620.50.
LME copper has shed 10% since hitting a four-month peak of $10,158 last September. “The problem with all the base metals is that they’re in a waiting pattern to figure out what’s happening with tariffs,” said Nitesh Shah, commodity strategist at WisdomTree. “That’s really throwing a lot of noise into the market at the moment and it’s hard to see how other fundamentals can be heard above that at the moment.”
Trump’s spokeswoman on Tuesday said he still planned to make good on his promise to slap new tariffs on Canada, Mexico and possibly China, the world’s biggest metals consumer, on Saturday. “We continue to expect LME base metal flat price weakness in response to confirmation of wider tariffs,” Citi said in a note.
US Comex copper futures rose 0.5% to $4.304 a lb or $9,489 a ton, a premium of $391 over the LME price, as investors seek to price in the impact of tariffs.
Aluminium paused after climbing by 1.8% on Wednesday in the wake of news that the European Union proposed banning imports of the metal from Russia in a fresh package of sanctions over its invasion of Ukraine.
“There’s uncertainty because Hungary may vote against it. That’s another concern hovering over the aluminium market,” Shah said. The discount of LME cash aluminium to the three-month contract declined to $6 a ton, the weakest since last September and compared to a discount of $30.80 three weeks ago.
The weaker discount indicates a tighter short-term availability of LME stocks, which have dropped 48% since last May. Among other metals, LME nickel shed 0.5% to $15,415 a ton, zinc gained 0.8% to $2,804, lead added 0.3% to $1,967 and tin was up 0.2% at $30,150. The Shanghai Futures Exchange is closed for the Lunar New Year holiday.
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