LME curve reflects stronger expectations for forward balances and rates
April 10, 2024
Key Observations:
LME copper cash-to-three has steepened to a new low (–$134 per mt, –1.4%). However, unlike last autumn, this steepening is not a bearish signal.
LME cash prices are rising (+$516/t mtd), and LME 3M prices are rising faster (+$551/t mtd), as a pickup in global manufacturing lifts metals demand.
The M1-M3 CMX spread was not so far above autumn 2023 lows as recently as last week. M1 advanced to within 1% of 2023's high, yesterday.
This week SFE M1 copper has vaulted to a 2-year high.
Source: SFE, LME, CMX, Blacklight Research. Note: the 2024 ytd low in LME cash copper was made intraday on Feb 9 at $8,030 per mt. Settlements that day were $8,065 in cash and $8,169 in 3M. Closing prices on Apr 9 were $9,283 and $9,418, respectively, for advances of +15.1% and +15.3% since the Feb 9 closes. Takeaway for investors: the outlook for copper remains strong. This bull market is still in an early stage of its development. Antofagasta is a bellwether.
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