MARKET COMMENTARY
In March, 3M LME copper prices traded within a volatile range of $11,700 – $13,433 per ton. Price movements throughout the month were primarily driven by geopolitical developments, macroeconomic expectations, and investor sentiment.
At the beginning of the month, escalating tensions between the United States, Israel, and Iran, along with Iran’s effective closure of the Strait of Hormuz—a critical route for global commodity trade—heightened concerns over potential supply disruptions, providing initial support to copper prices.
However, despite these supply-side risks, a stronger US dollar, driven by safe-haven demand, and rising oil prices, which fueled inflation concerns, reinforced expectations of a more hawkish stance from the Federal Reserve. This environment increased selling pressure across base metals, weighing on copper prices.
Amid intensifying geopolitical tensions and mutual threats between the US and Iran, copper prices declined sharply, reaching $11,700 per ton on March 23—the lowest level since December 19. Although prices found some support from dip-buying at these levels, the overall recovery remained limited as investors cautiously assessed ongoing developments in the Middle East.
Towards the end of the month, copper prices received renewed support following reports of damage to key aluminum smelting facilities in the Gulf region, which strengthened expectations of prolonged supply tightness across metals markets. Additionally, statements by US President Donald Trump suggesting that military actions against Iran could be concluded within a few weeks, and that a resolution might not necessarily require a formal agreement, raised hopes for potential de-escalation in the region. This contributed to a partial recovery in prices.
Overall, 3M LME copper prices closed March at $12,382.5 per ton, marking a monthly decline of 6.87%.
