The international copper market has recently experienced significant volatility. The impact of the accident at Indonesia's Grasberg copper mine has far exceeded expectations. The latest assessment by operator Freeport McMoRan indicates that the mine's production capacity will not fully recover until 2027 at the earliest, with copper output for 2025-2026 projected to be approximately 270,000 metric tons below original plans. This sudden supply contraction propelled the Shanghai Copper main contract to a daily gain exceeding 3%, while LME copper prices strengthened in tandem, breaking the low-volatility pattern that had persisted for nearly a year.

Positive signals emerged on the macroeconomic front. U.S. new home sales data for August delivered a standout performance, with actual annualized sales of 800,000 units far exceeding market expectations of 650,000 units. This represented a month-on-month increase of 20.5%, sharply contrasting with anticipated declines. This robust data eased market concerns about an economic recession. Notably, U.S. Treasury Secretary Bessenet publicly questioned the Federal Reserve's monetary policy, advocating for a rate cut of 100-150 basis points before year-end.

Inventory data indicates a sustained destocking trend. LME copper inventories edged down by 200 tons to 144,775 tons, COMEX stocks decreased by 142 tons to 288,695 tons, and SHFE copper warehouse receipts fell by 308 tons to 27,419 tons. However, constrained by elevated copper prices and macroeconomic uncertainties, downstream purchasing sentiment remains cautious. Domestic social inventory drawdowns have been slower than anticipated, with market attention focused on whether pre-holiday stockpiling demand can improve the current situation.

Investors are advised to monitor long opportunities arising from supply-side disruptions while closely tracking changes in end-user demand. The current copper price breakout may extend into the fourth quarter, but caution is warranted regarding potential demand suppression at elevated price levels.