Copper prices lost ground on Wednesday, despite concerns over tight supply, as a firmer dollar weighed on prices amid quiet trade ahead of a week-long holiday in top consumer China, reports Reuters.
Benchmark three-month copper on the London Metal Exchange was down 0.2% at $9,936 a metric ton in official open- outcry trading.
"From a technical perspective, it seems fairly clear it's hit a significant ceiling for the short term," said Dan Smith, managing director of Commodity Market Analytics.
The US dollar index strengthened by 0.5%, weighing on the market, even amid lingering supply concerns due to an outage at the Grasberg copper mine in Indonesia.
A stronger US currency makes dollar-priced commodities more expensive for holders of other currencies.
Marex said in a note that the weakness in the offshore yuan was dragging down copper prices. "Overall turnover is running light. But it is really the lack of Chinese activity as they wind down ahead of next week's holiday," the brokerage added.
Aluminium, meanwhile, slipped 0.5% to $2,624 per ton.
But in the United States, the premium paid to buy aluminium on the physical market - on top of the LME price - was at a record high of $0.74 per lb, or $1,631 a ton.
The premium has almost doubled since the end of May after US President Donald Trump raised the tariff on imports of the metal to 50% from 25%. CRU senior analyst Alex Christopher said on a webinar this week that the rise in the premium had been slowed by a roughly 150,000 tons inventory build ahead of the increase in tariffs at the start of June.
"We now believe that has been consumed and that's why we're now seeing the full impact of the 50% tariff," Christopher said.
Among other metals, zinc was down 0.4% at $2,876 a ton, even as LME zinc stocks fell to 44,400 tons, the lowest since April 2023. Nickel shed 0.5%, while lead was flat and tin declined by 0.3%.
