- Adani copper receives LME approval for 0.5 mtpa smelter
- Aluminium substitution may reduce copper demand by 6% by 2030
LME copper prices remained largely range-bound throughout the week, trading between $13,250–13,350/t before closing at approximately $13,345/t. Prices remained subdued after the 30 June deadline for the US Section 232 investigation into refined copper imports passed without any official tariff announcement.
Meanwhile, LME copper inventories fell 5.2% w-o-w from 336,475 t to 318,900 t, highlighting tightening physical availability. However, the supportive impact of lower inventories was offset by tariff uncertainty and cautious macroeconomic sentiment, keeping prices largely stable.
Market sentiment remained mixed during the week. Expectations that the U.S. Federal Reserve could maintain a restrictive monetary policy continued to weigh on the outlook for industrial metals demand, although softer-than-expected U.S. employment data later in the week reduced expectations of near-term rate hikes. Additionally, improving commercial traffic through the Strait of Hormuz also eased immediate supply concerns, limiting upside momentum.
Improving downstream demand in China and recovering refined copper imports reinforced physical consumption, while sustained exports and tighter domestic inventories highlighted tightening supply conditions, providing underlying support to LME copper prices.
Global updates
Global shift towards aluminium could weigh on long-term copper demand
Rising copper prices are accelerating the global shift towards aluminium, which is about 75% cheaper at around $3,000/t. Analysts estimate this substitution could reduce global copper demand by 2% in 2026, increasing to 6% by 2030. In China alone, 25–30% of copper components across key industries could be replaced by aluminium by 2030. This growing substitution trend poses a long-term bearish risk to copper demand despite continued structural supply shortages.
India’s updates
Adani copper gains LME approval, boosting India’s global copper presence
The London Metal Exchange (LME) has approved Adani Copper as a listed brand for delivery against its copper contracts, with warrants effective from 10 July 2026, marking a major milestone for both Adani Copper and India’s copper industry. The approved 0.5 mtpa smelter, developed by Adani Copper with an investment of USD 1.2 billion, is among the world’s largest single-location copper smelters and plans to expand capacity to 1 million tonnes per annum.
The approval is expected to enhance the global tradability of Adani Copper’s refined copper, strengthen export opportunities, and support India’s ambition of becoming a net exporter as domestic refining capacity continues to grow.
India’s finished copper imports decline during 5MCY’26
India’s finished copper imports weakened in 5MCY’26, with long imports falling 12%, while flat imports declined 25% y-o-y amid geopolitical disruptions in the Middle East and stricter scrutiny of ASEAN imports under Rules of Origin (RoO) also affected trade flows, while demand for specialised products remained strong, with copper foil imports surging 132% due to rapid growth in India’s electric vehicle and battery sectors.
Outlook
Goldman Sachs expects copper prices to remain primarily driven by developments in US trade policy rather than geopolitical tensions in the Middle East. While concerns over the Strait of Hormuz have eased, market attention has shifted to Washington’s pending decision on refined copper tariffs, which will determine future trade flows and inventory movements.
In the near term, tariff uncertainty and softer demand may keep prices range-bound; however, any announcement on US import duties could trigger renewed volatility and reshape the global copper market.
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