In April, the copper market shifted into a 50,000-ton supply deficit, according to the International Copper Study Group data. Despite this, the first four months still recorded a supply surplus of 233,000 tons, similar to the previous year.

The ICSG anticipates a surplus of nearly 300,000 tons by year’s end but suggests improvement in the supply situation is needed. Chinese copper smelters plan to boost exports to replenish the London Metal Exchange’s stocks, suggesting supply is currently adequate.

Concerns about the US importing more copper due to potential tariffs have caused recent strong outflows of copper stocks both at the LME and in China. This trend is viewed as a central factor impacting the market situation.

The copper market, by April, found itself in a minor shortage of 50,000 tonnes, though this came after a stretch of surplus that had built up earlier in the year. Over the January to April period, there was still a cumulative overhang of 233,000 tonnes, putting early-year supply well ahead of demand. That figure is more or less matching the prior year, meaning we’re not exactly in new territory from a fundamental view.

The International Copper Study Group has projected that by December, the world will be sitting on a surplus nearing 300,000 tonnes. So, while April hints at tighter conditions, the broader picture shown in the data suggests that the cumulative stockpile remains a buffer. What happens between now and the final quarter could sway expectations dramatically, though the room to adjust these figures heavily depends on production continuity and shifts in refined copper flow.

On the export front, Chinese smelters are reportedly aiming to raise overseas deliveries. That move appears to be targeting depleted inventories held in official warehouses, particularly those governed by the London Metal Exchange. The action from China implies there’s confidence in domestic supply capacity, or at least enough stability right now to redirect metal outwards.

That said, we’re seeing some remarkable inventory outflows, not just in London but from Chinese tracked stocks too. The market is clearly reacting to trade expectations—specifically, hints that the US may increase copper purchases amid possible tariffs. Policymaking in that area is starting to pull material into motion. The removal of metal from visible stores creates a tightening effect, at least perceptually, even when structural data points to ample supply.

We’re treating these movements as deeply tied to a reactionary view rather than a full demand surge. It doesn’t suggest a new consumption boom, but more so an attempt to hedge before external policy pressures bite. Traders should stay close to physical flows: what’s going into warehouses, what’s getting redirected, and where stocks are vanishing quickest.

Inventories being drawn down this fast can trigger pricing that moves well ahead of fundamentals. If we base our decisions on flow alone, there’s a risk of getting caught out. What matters more now is tracking the response lag—how quickly producers and shippers adjust to dislocations in demand signals.

Pay attention to shifts in trade policy and port data. If copper continues to exit warehouses while spot demand fails to rise in tandem, it tells us the restocking is not industrial in nature. It’s precautionary. That sort of market activity often fades once the immediate threat subsides. So, we should be aware of that gap forming between headline flows and real end-use.

Expect daily volatility to remain high while these macro assumptions play out. Nearby contracts may get pushed around more by sentiment than scheduling. We ought to stay nimble with margin allocation and avoid extending risk exposure based on isolated supply squeezes. Instead, priorities should lean towards confirming long-range delivery trends and watching for where excess might come back into view.

These weeks ahead are offering more clarity, yes, but also more opportunities for the wrong narratives to gain ground. We must keep recalibrating prices against actual consumption figures before acting on the headline stock moves alone.