Copper futures in the US fell below $5.9 per pound on Monday, near a three-week low, as demand concerns tied to the US–Iran conflict offset tight supply. The hopes for a resolution again got a setback after it was reported that Iran struck US military vessels after US launched an operation to safeguard navigation through the Strait. This pressured base metals, as stronger dollar and weaker purchasing power weighed on demand for industrial materials. Still, copper remained around 10% away from its record high as the conflict also dented supply for copper in the near term. Top producer Chile faces supply risks as the conflict disrupts sulphur flows to China, prompting Beijing to curb exports of sulphuric acid, an input critical to nearly half of Chile’s copper refining capacity. On top of that, major tech companies continued to sign agreements that exponentially increase datacenter construction, supporting the outlook for copper due to its utility in electrification and grid technology.

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