Continual deliveries put pressure on copper backwardation

The backwardation in nearby copper spreads may soon start to unravel if the large daily inflows of copper seen since the start of the year continue, market sources told Metal Bulletin sister publication Copper Price Briefing.

While still at historically low levels, copper stocks have risen by more than a quarter so far in 2015, with several large inflows into Antwerp, Busan, New Orleans and Johor taking total LME inventories to 225,375 tonnes on Thursday January 22. So far, the deliveries have not led to a reduction in the size of a dominant position in copper stocks and nearby forwards that has shown up consistently in LME positioning reports over the past year or so. On Tuesday January 20, a single entity held 50-<80% of all live warrants and 80-<90% of warrants, tom and cash positions. There is mounting speculation that the dominant party may let go...


Mark Burton

January 23, 2015

10:05 GMT