Trafigura Withdraws Major Copper Volumes from LME as Global Arbitrage Drives US and China Demand
Trafigura Pulls 51,000 Tons of Copper from LME Warehouses as US–China Price Gap Sparks Record Arbitrage Trade
Global commodities trader Trafigura Group has initiated the withdrawal of hundreds of millions of dollars’ worth of copper from London Metal Exchange (LME) warehouses, capitalising on widening price disparities between markets in the United States, China, and Europe.
According to market participants familiar with the transactions, Trafigura was the principal party behind orders to remove more than 51,000 tonnes of copper from LME storage facilities across the US and Asia on Friday.
The sources requested anonymity due to the commercial sensitivity of the activity.
The scale of the withdrawal marks the largest movement of copper from LME warehouses since 2013, underscoring intensifying global competition for physical metal supplies.
The move comes amid a significant arbitrage opportunity between exchanges. Copper futures on New York’s Comex have surged above LME prices for an extended period, creating strong incentives for traders to divert material into the US market.
The price gap has been driven in part by concerns that potential US trade measures, including tariffs on copper, could tighten domestic supply conditions.
As a result, Comex contracts priced inclusive of potential import duties have consistently traded at a premium over LME contracts, encouraging large-scale physical shipments into US storage hubs.
Traders have previously exploited this spread, with record copper inflows into the US last year as market participants sought to lock in profits from the price differential.
On Friday alone, more than 30,000 tonnes of copper were reportedly ordered out of LME warehouses in New Orleans and Baltimore. Market sources indicated that this material is likely to be delivered into Comex-approved storage facilities or sold directly to US-based consumers.
A further 20,000 tonnes were withdrawn from LME warehouses in Asia. While part of this volume may also head to the United States, rising copper prices in China are simultaneously creating strong incentives for shipments into Asian markets, adding further complexity to global trade flows.
At an LME price of approximately $13,660 per tonne, the total value of the copper ordered for withdrawal exceeds $700 million, highlighting the scale of the ongoing arbitrage-driven repositioning of global metal inventories.
The trading opportunity reflects broader structural shifts in global commodities markets, where regional pricing disparities and geopolitical uncertainty continue to drive aggressive physical repositioning strategies among major trading houses.
Trafigura declined to comment on the transactions.
