LME copper stocks peaked near 204,000t earlier this year on arrivals of Chinese brands. That build has reversed. Total inventories have declined every day since May 28, per LME data.
The split between the U.S. and the rest of the world defines this market now. COMEX inventories sit at record highs after two years of tariff-driven stockpiling. Outside the U.S., exchange stocks are thin by any historical measure. S&P Global calls it 'operational fragility' — small shocks can move prices fast.
J.P. Morgan puts global visible inventory at nearly 1.5 million tonnes, up 540kt year-to-date. But almost all of that increase is in the U.S. European and Asian consumers face high regional premiums with no relief in sight.
The LME cash-to-three-month spread has been volatile, briefly hitting $42/t backwardation as metal was withdrawn. ING analysts note that while headline inventory numbers look comfortable, the usable metal outside the U.S. is far tighter than the aggregate suggests.
Off-warrant stocks complicate the picture. Reuters reported 90,720 tonnes of off-warrant copper in LME storage at Baltimore and New Orleans — metal physically stored but not deliverable against LME futures. It is a buffer, but it does not show up in the headline figures.
The U.S.-RoW inventory split creates a real problem for non-U.S. buyers. European and Asian consumers should secure Q3-Q4 term coverage now. Regional premiums will stay elevated as long as LME stocks keep dropping. Watch the daily LME stock reports — if the drawdown accelerates, expect spot backwardation to widen.