LME copper futures hit a record high as investors bet on the prospect of a supply shortage

Gold Ten Futures, May 20, according to foreign media reports, copper prices rose to a new record high, extending a multi-month rally, and financial marekt investors flocked to the copper market in anticipation of a supply shortage. London Metal Exchange (LME) copper futures rose as much as 4.09% to $11,104.50 a tonne, surpassing the previous record set in March 2022. The record for LME copper futures came as a massive short squeeze in the New York market disrupted the global copper market. Last week, COMEX copper prices hit a record high. The short squeeze pushed COMEX copper prices to an unprecedented premium over LME copper and triggered a rush to shift metal supplies to the United States. Copper prices on the LME have risen more than 25 per cent since the start of the year after a sudden tightening in ore supplies heightened the possibility that global markets could face supply shortages sooner than expected if smelters respond by reducing refined copper production. A series of setbacks at major copper mines in recent months have sparked investor buying, despite warnings from many spot copper traders that the market is excessively ahead of fundamentals. Demand remains relatively tepid, especially as inventories in China remain high. However, supply disruptions and continued price gains have strengthened the confidence of copper bulls, while also attracting financial investors to bet on further gains.