On the Comex market, copper for delivery in March fell by 0.59% to $3.7500 a pound ($8,250 a tonne). Benchmark copper on the London Metal Exchange (LME) was down 0.1% at $8,289.50 a tonne in official trading.
Many analysts forecast a multi-year bull run as demand outpaces supply, with investors weighing prospects for a fast-tracked stimulus package in the US.
“We expect high metal prices to continue, with a positive effect on our metal result,” said Roland Harings, CEO of Europe’s largest copper producer Aurubis.
“We anticipate a strong improvement in demand for our products overall,” he said.
Analysts at Goldman Sachs and Bank of America are calling for copper prices to return toward all-time highs, lifted by the tight supplies and coming global resurgence in demand.
“Spring is likely to bring a fresh demand boost,” said Morgan Stanley analysts Susan Bates and Marius van Straaten. “The supply side appears ill-positioned” to meet it.
Copper inventories in warehouses registered with the LME and Comex exchange are falling, with LME stocks near their lowest since 2005 at 73,500 tonnes.
“Falling inventories could help to draw bulls back in,” Citigroup analyst Oliver Nugent told Bloomberg.
Rough seas and a shortage of containers have bogged down shipments of copper cathodes from Chile, the world’s largest producer, and could continue to slow exports.
“Containers are still tight, and they are very expensive,” Juan Carlos Guajardo, executive director of the consulting firm Plusmining told Reuters.
While most of Wall Street is gearing up for higher prices, the rally is not without its doubters.
Gianclaudio Torlizzi, a partner at consultant T-Commodity, told Reuters the market may be getting ahead of itself.
“The more the price moves up in the very short term the bigger the fall will be in the second half of this year,” he said.
“The $7,000 level will be retested. If it goes to $9,000, that will be a good opportunity to short.”
(With files from Bloomberg and Reuters)