LONDON: Copper prices on the Chicago Mercantile Exchange hovered near record highs on Thursday as buyers piled in expecting further gains due to sellers not being able to deliver the metal against their positions and having to roll them forward.

CME copper hit a record high of $5.1775 a lb or $11,414 a metric ton on Wednesday. It was down 0.1% at $4.964 a lb at 1036 GMT on Thursday. One trader said those with short positions had decided to postpone closing their positions beyond June.

Short positions can be bets on lower prices, or producers selling their output for a future period. Commodity traders including Trafigura and IXM are among those caught in the short squeeze. They are looking to buy copper in the physical market to deliver against the CME contract.

CME copper has risen 28% so far this year, outpacing gains on the London Metal Exchange (LME) and creating an opportunity for traders to buy on the LME and sell on the CME. Benchmark copper on the LME was up 1.7% at $10,396 a ton, within sight of the record high of $10,845 hit in March 2022.