U.S. Treasury Intervenes in Bond Market, Rising Inventories Help Copper Hold $14,000 Psychological Level

International copper prices successfully held the psychological $14,000 per ton level on Thursday (20th) amid mixed bullish and bearish factors. This was supported by the U.S. Treasury's unexpected intervention in the bond market to curb borrowing costs, providing strong backing to the metals market. At the same time, a significant rebound in inventories at the London Metal Exchange (LME) effectively eased prior market concerns about supply tightness.

U.S. Treasury Secretary Scott Bessent announced on Wednesday an expansion in long-term government bond purchases aimed at curbing surging yields and supporting U.S. economic growth. This move led to falling U.S. bond yields and a weaker dollar, making dollar-denominated metals more attractive to buyers using other currencies.

On the supply side, earlier market expectations that the U.S. government would impose import tariffs on refined copper prompted large volumes of inventory to flow into U.S. warehouses, temporarily causing LME inventory depletion and historic supply tightness.

However, with substantial copper deliveries arriving at LME warehouses on Tuesday and Wednesday, this short-term supply crunch has been alleviated. LME copper inventories rose by 12,425 tons on Wednesday, bringing total stocks to 235,975 tons—up 11% from the previous week but still 40% lower than three months ago.

As of Thursday’s trading, LME three-month copper futures dipped 0.04% to $14,043.5 per ton, while the most actively traded copper contract on the Shanghai Futures Exchange (SHFE) edged up 0.15% to 107,140 yuan per ton. Jinrui Futures Co. noted that market sentiment remains highly volatile and urged close monitoring of the macroeconomic environment and further developments regarding copper tariffs.

In other metals and commodities, reports indicated that the U.S. and Canada are negotiating a trade agreement that could halve the maximum tariff rate on Canadian aluminum imports to 25%, leading to softer aluminum prices. Previously, due to higher U.S. tariffs, some Canadian aluminum producers had rerouted shipments to Europe. Additionally, iron ore prices fell 0.7% to $95.30 per ton, while LME and SHFE zinc, lead, nickel, and tin showed mixed price movements.