MARKET COMMENTARY
In September, 3M LME copper traded between $9,844 and $10,485. Prices came under pressure at the start of the month as expectations for a Federal Reserve rate cut strengthened, driving copper down to $9,844. However, falling refined copper production in China raised supply concerns and supported the market. Later in the month, the Fed cut its policy rate by 25 basis points to 4.00–4.25%, in line with expectations. Chair Jerome Powell indicated that gradual monetary easing could continue. While the stronger U.S. dollar limited the upside, optimism over U.S.–China trade talks and renewed supply risks supported prices. On September 25, following an accident at Freeport Indonesia’s Grasberg mine, one of the world’s largest copper producers, force majeure was declared and production was suspended. This drove copper to $10,485, its highest level since 29 May 2024. The metal closed September with a 3.94% gain at $10,296.
During the first week of September, copper traded between $9,844 and $10,038. On September 3, prices tested $10,038, the highest level since March, supported by a positive economic outlook in both the U.S. and China. However, profit-taking and a rebound in the dollar prevented further gains. Although falling Chinese refined copper production raised supply concerns, weaker U.S. employment data strengthened expectations of a Fed rate cut, which weighed on prices. Copper ended the week down 0.41% at $9,865.
In the second week, copper started at $9,883 and gained momentum from weak U.S. labor data, which reinforced expectations of Fed easing and pushed prices above $10,000. Midweek, new U.S. tariffs prompted global funds to reduce positions, briefly pressuring the market. However, declining LME inventories and renewed demand expectations in China triggered a sharp rebound. On Friday, copper climbed to $10,126 before closing the week at $10,064, marking a strong performance.
In the third week, weak Chinese data weighed on prices early on, but optimism over progress in U.S.–China trade talks lifted copper to $10,192.5, its highest level since June 2024. Although volatility increased due to dollar strength after the Fed’s rate decision, Chinese buyers engaged in pre-holiday restocking ahead of the October break, helping the market recover. Copper pulled back from $9,917 but finished the week at $9,962.
In the fourth week, copper prices began the week on a stronger note, supported by supply concerns after Grasberg mine operations were suspended. While the stronger dollar limited upside potential, copper rose to $10,485 on September 25, the highest since May 2024. It ended the week up 2.09% at $10,205.
In the final trading days of September, which overlapped with China’s National Day holiday, copper came under pressure from profit-taking following its rally to a 15-month high. Despite restocking demand in China ahead of the holiday, high prices and uncertainty over U.S. interest rates dampened risk appetite. Copper closed the month at $10,296, down 1.27% on the day.
