Copper shows up in everything from wires to electric cars. Right now, it is also stuck in a tug-of-war between the world's two biggest economies.
Many traders expect prices to soon top the record $14,500-plus reached briefly at the end of January during a wave of speculative buying in China.
In London at 2:02 p.m., copper futures on the London Metal Exchange were up 0.1%.
The price sat at $14,120 a ton. The bigger story is where the metal is actually sitting.
Comex copper, the US futures benchmark, hit a record Wednesday.
Traders buy copper where it's cheaper and sell it where it's more expensive. That arbitrage has been running since last year and has now reached a tempo not seen in more than a decade.
China is the world's biggest copper producer and consumer. Its smelters are cutting output because raw materials are tight, so buyers rely more on imports and Shanghai Futures Exchange stocks keep falling.
The problems showed up in July. Chinese smelter output fell more than forecast, according to Shanghai Metals Market, which cited higher ore prices and lower ore grades.
A lot of the metal moving into China is coming out of LME warehouses in Taiwan and South Korea. Over the past two weeks, traders have pulled batches of 4,000 to 6,000 tons out of those warehouses almost every day.
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Some US LME warehouses also sent metal out because Comex prices were higher.
Since May, LME stockpiles have shrunk by over two-fifths.
Mercuria Energy Group, Trafigura Group, Vitol Group and Hartree Partners are among the trading firms that have recently withdrawn metal from LME depots. None of their representatives commented.
The market's pricing structure has turned to backwardation, a setup not seen since January. That means copper for immediate delivery now costs more than copper for delivery in three months.
"Even if demand is not at the moment doing amazingly, you can have a bit of a step change where the constraint on the supply is causing this draw on inventory," said Tom Mulqueen, Citigroup's metals strategist.
Typically, Chinese purchasers step aside when prices rise, and the latest surge is already giving some of them pause. That could slow import demand just as the market tightens.
A lot depends on a policy call that is still up in the air. President Trump has placed US duties on semi-finished copper, but not on refined copper.
Traders are waiting to see if he extends them to raw metal, and nobody has set a timeline.
Trump has scheduled a meeting with mining executives in Washington on Friday, and he plans to unveil several deals and memoranda of understanding. That could offer clues about where the policy is headed.
The range of outcomes is wide. If no refined-copper tariff comes, the pull from US buyers would fade and leave more metal for China.
If the uncertainty drags on, traders expect prices to keep climbing as available metal runs short. If Trump announces tariffs, a sharp surge is likely as traders rush shipments to the US before levies apply.
China's own supply picture adds another layer. One-quarter of its refined copper output comes from scrap, but stricter invoice checks have disrupted the recycling industry.
Small scrap collectors often use up their invoicing quotas and cannot complete sales, which weakens the buffer that scrap has provided for 20 years when mine supply fell or demand grew.
"You lose some of that elasticity because of these additional headwinds," Mulqueen said.
For investors, copper is no longer just a commodity. It sits between US policy and China's supply problems, and the next few weeks could set the direction for the rest of the year.
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