The price of copper collapses amid speculation pressures and insufficient demand

Copper prices are experiencing a sharp decline as market attention shifts back to weak consumption indicators, moving away from the previous speculative boom that had distanced valuations from actual economic fundamentals. According to Jin10 data, industrial metals on the London Metal Exchange are falling for the third consecutive day, trading at approximately $12,800 per ton. This situation presents a complex outlook where copper price volatility reflects the tension between speculative forces and market realities.

Consecutive decline reflected in major exchanges

Since last week, copper has shown a valuation decline of 2.9%, marking its worst weekly performance since April. Deposits in London warehouses and New York futures markets have reached levels not seen since 2003, indicating an inventory buildup that starkly contrasts with limited demand in the global economy.

Financial institutions warn of overvaluation

A growing consensus among top-tier analysts has identified that current prices lack fundamental support. BNP Paribas has joined Goldman Sachs in warning about the widespread overvaluation of the metal. David Wilson, a strategist at BNP Paribas, explained that copper prices remain “excessively inflated,” with margins of $11,000 to $11,500 per ton being “practically driven by pure speculation without demand fundamentals support.”

Historic inventories reveal weak demand

Unprecedented stock accumulation in major global distribution centers sends a clear message: actual copper demand remains fragile. This mismatch between available supply and effective consumption reinforces the warning that prices are operating away from their equilibrium values, primarily sustained by temporary speculative movements.