Copper Holds Retreat from Record High

Copper futures were at $6.2 per pound, sustaining the pullback from the record high of $6.65 on May 13th as skepticism over a peace agreement in the Middle East maintained energy prices elevated, squeezing demand for manufacturing inputs. Energy prices regained traction as momentary optimism over an agreement between the US and Iran waned, pressuring industrial metals. Still, prices drew support from a rally in artificial intelligence-related technology stocks since the start of May, which strengthened expectations for demand tied to electrification wiring in data centers. Meanwhile, supply from Codelco risked a pullback as the company is targeting roughly $2 billion in cost reductions and additional revenue through the integration of operations across three copper mines, as the company seeks to counter the effects of stagnant production and rising debt levels.

Copper futures traded around $6.28 per pound on Thursday after rising 2% in the previous session, supported by improving global risk appetite amid renewed optimism over a potential peace agreement between the US and Iran. President Trump said the US was in the final stages of negotiations with Iran, fueling hopes that the Strait of Hormuz could soon reopen. The prospect of restored shipping flows triggered a sharp decline in oil prices, helping ease inflationary pressures and reducing concerns about further interest rate hikes. Copper prices also drew support from a rally in artificial intelligence-related technology stocks, which strengthened expectations for demand tied to data infrastructure development. In corporate news, Codelco is targeting roughly $2 billion in cost reductions and additional revenue through the integration of operations across three copper mines, as the company seeks to counter the effects of stagnant production and rising debt levels.

Copper decreased 2.05% to 6.1434 USD/Lbs