According to foreign media reports on June 27: Copper in the London Metal Exchange (LME) warehouse has been snapped up again.
LME copper stocks have fallen from 100,100 tonnes to 77,050 tonnes in the past three weeks, although almost 30,000 tonnes have arrived.
What arrived just quickly turned around and went out again. The tonnage available is only 31,900 tons, enough to supply the global market for about 11 hours.
Unsurprisingly, the stock market rout has pushed up spot spreads on the London Metal Exchange. The backwardation between benchmark spot and three-month contracts on the London Metal Exchange was $31 a tonne at Monday's close. This is the highest cash premium since last November.
The drawdown in LME copper stocks is puzzling given weak manufacturing activity in Europe and the US.
The closure of Swedish producer Boliden's Ronnskar smelter has left the European market with a 220,000 tonne supply shortfall, but LME inventories began to rush even before the June 13 fire at the plant and are concentrated in Asia and the US rather than Europe.
This is not the first time that LME stock market signals have been refracted, and the lower the share price, the more likely the light is to be refracted.
But it's not just a London phenomenon. Visible stocks are low everywhere.
Global problem
At the end of last week, copper stocks registered with the London Metal Exchange, the Chicago Mercantile Exchange and the Shanghai Futures Exchange totalled 165,000 tonnes.
Global gold exchange inventories are now 45,500 tonnes lower than at the start of the year, the lowest level since 2008.
The slight increase in LME inventories during April and May was reversed this month.
CME stocks are rising, but from a very low base, and currently stand at 27,859 tonnes, still down 3,975 tonnes from the start of the year.
Stocks on the Shanghai Futures Exchange rose sharply during the seasonal lull in demand during the Lunar New Year holiday, but were flat at 252,455 tonnes in February before rapidly shrinking to just 60,424 tonnes.
The Shanghai stock exchange has tightened at the front end of the yield curve since March, and the current spread is the widest since November.
