Why Is Copper Price Rising Today? LME Nears Record High As Supply Squeeze Deepens; Finolex Cables, KEI, Polycab Rise Up To 5%
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Copper's spot price traded as much as $518.50 a tonne above three-month contracts on the LME, the biggest gap since a major squeeze in 2021, as tightening supply pushed prices near record highs and lifted cable and wire stocks.
Copper prices moved close to a record high on Monday, August 17, as tightening near-term supplies on the London Metal Exchange (LME) pushed the metal higher. The move also lifted domestic cable and wire stocks, with Finolex Cables, KEI Industries and Polycab gaining as much as 5.25%, 2.5% and 1.24%, respectively.
Three-month copper futures on the LME rose as much as 1.7% to $14,396 a tonne, extending gains for a seventh consecutive week. Prices are now close to the record high of $14,527.50 a tonne.
Why Is Copper Price Rising Today?
The immediate trigger for the latest rise is the unusually large premium being paid for copper available for immediate delivery. The LME cash contract traded as much as $518.50 a tonne above the three-month contract on Monday.
The gap, known as backwardation, was the widest since the copper market squeeze in 2021. A sharp premium for spot metal generally points to tight availability, as buyers are willing to pay more to secure supplies immediately.
LME-monitored copper inventories have also fallen to just over 200,000 tonnes, their lowest level since February. Falling warehouse stocks have added to concerns over the availability of copper in the near term.
Why Are Copper Prices Rising In 2026?
Copper has gained nearly 16% so far this year, with a large part of the rally linked to the movement of metal into the US ahead of a possible decision on tariffs on refined copper imports.
Traders have been building stocks in the US in anticipation of potential duties. While global copper inventories remain relatively healthy, a larger share of available metal is now sitting in the US and outside the LME warehouse system. This has reduced supplies available to other markets.
The longer-term outlook for copper demand has also remained supportive. The metal is widely used in power infrastructure, renewable energy and electrification, while bringing new mines into production can take several years. This has kept concerns over future supply growth in focus.
US Copper Tariff Decision Keeps Market On Edge
The market is still waiting for clarity on US tariffs on refined copper. The White House has not announced its plans, despite the deadline for the Commerce Department to submit its recommendation having passed around seven weeks ago.
Copper shipments into the US have continued as traders position for the possibility of tariffs. Demand in China, meanwhile, has remained comparatively weak.
The sharp widening in the cash-to-three-month spread could also encourage copper flows from China if the premium for immediately available metal remains elevated. Such movements typically become more attractive when physical supplies are tight in one part of the market.
What Could Drive Copper Prices Next?
The direction of copper prices will depend largely on LME inventory levels, the pace of shipments into the US and any decision by the Trump administration on refined copper tariffs.
The current backwardation could also lead to greater volatility if the supply squeeze intensifies. Traders with short positions may need to buy back contracts or secure physical copper to meet delivery requirements.
If LME inventories continue to fall while more copper moves towards the US, supplies available elsewhere could become tighter. That could keep prices elevated in the near term. Longer term, demand linked to electrification and the energy transition could provide further support.
Cable And Wire Stocks Rise On Copper Price Rally
The rise in copper prices also supported Indian cable and wire manufacturers, for whom copper is a key raw material.
Finolex Cables led the gains, rising 5.25% during the session. KEI Industries gained 2.5%, while Polycab advanced 1.24%.
The stocks have been closely watched as copper prices rise because sustained increases in the cost of the metal can affect input costs, while companies with the ability to pass on higher costs may be better placed to protect margins.
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Rochelle Britto is a business journalist with 8+ years of experience in financial journalism. She covers equity markets, corporate earnings, IPOs, commodities and the economy.
As a reporter with leading business publications, she has tracked financial markets and covered sectors including banking and financial services, retail, consumer goods, advertising and e-commerce.
Outside work, she enjoys travelling, discovering local cultures and spending time in nature.
