The LME cash contract was at $23,120 per tonne on January 26 - nearly $300 above its three-month delivery counterpart, which went as high as $22,740 per tonne on the same day, with both prices at near seven-year highs.
This comes at a time when exchange stocks have slumped to an eight-month low - and close to their lowest since 1989 - at just above 1,000 tonnes.
Demand for the metal remains stable; however, a less-globalized semiconductor production process due to international trade tensions means supply hitches stemming from Covid-19 lockdowns in 2020 have had an outsized effect on the market, sources told Fastmarkets.
“The tight global market and low stocks are a big factor, not just on the LME but in terms of what traders and producers have available,” head of research at Amalgamated Metal Trading, Tom Mulqueen, said.
“There just isn’t enough stock available to absorb the imbalance between supply and...