Copper hits record as Shanghai stockpiles fall to 2023 low

Copper closed on Tuesday, September 22, just $92 below its all-time high as draining stockpiles in Shanghai and London squeezed the physical market, completing a recovery from a tariff-driven selloff two weeks earlier that had knocked more than 5% off U.S. prices in a single session.finance.yahoo

Three-month copper on the London Metal Exchange settled at $14,783 a metric ton, up 0.8%, while Comex copper for December delivery hit $6.871 a pound intraday in New York. On the following day, copper futures touched an intraday record of $6.95 a pound before pulling back. The metal has gained nearly 20% in 2026 and more than 46% over the past year.beincrypto+1

Vanishing Inventories Drive the Rally

The rally is being driven not by policy shifts in Washington but by physical copper becoming hard to find in China. Copper cathode stocks in Shanghai fell to 43,900 tons last week, the lowest level since 2023, according to Shanghai Metals Market data. Inventories in Shanghai Futures Exchange warehouses have dropped 70% since early June, and imported cargoes arriving in China are going directly to fabricators rather than into storage.energymetalnews+2

Chinese buyers have been front-loading purchases before markets close Friday for the Mid-Autumn Festival and again October 1–7 for National Day, while several domestic refineries have scheduled maintenance for October and November. In London, cancelled warrants — metal booked for withdrawal — climbed to 122,150 tons on Tuesday, nearly half of all on-warrant stock, leaving just 133,725 tons available to the market.finance.yahoo+1

The U.S. presents a mirror image. Comex warehouses hold about 696,000 tons, roughly 69% of all exchange-monitored copper, after a year of importers rushing metal in ahead of tariffs that have yet to materialize.finance.yahoo

Burry Bets on Copper Over AI

The tightening market has drawn the attention of Michael Burry, the investor known for his role in "The Big Short." In a September 21 Substack post, Burry said he is "largely ignoring" the AI stock rally and disclosed a position in Ero Copper ↘ 2.17%, a Brazil-focused copper-and-gold producer. He cited data from Apollo chief economist Torsten Slok showing that major copper discoveries have collapsed from double digits a year to one or two, with none in 2025, while new deposits require roughly 18 years to reach production.benzinga+1

Supply Risks and What's Next

On the supply side, Sprott Asset Management ↘ 4.73% said global mined output could fall this year for the first time since 2017, with outages at Freeport-McMoRan's ↘ 2.38% Grasberg mine and Ivanhoe Mines' ↘ 4.85% Kamoa-Kakula stripping about 600,000 tons from expected 2026 production. BHP ↘ 3.28% faces a Wednesday deadline to present its final offer to a union at Escondida, the world's largest copper mine, whose contract expires September 30.finance.yahoo

Not everyone is bullish. Robert Montefusco at Sucden Financial told Reuters he thinks the metal is "a little bit inflated up here," warning that Chinese producers could start selling if prices climb further. Traders are now watching this week's meeting between President Donald Trump and Chinese President Xi Jinping for trade signals — and whether copper can take out its record before Beijing goes quiet for the holidays.finance.yahoo