Goldman warning on backwardation in copper to reverse inventory depletion

Goldman warning on backwardation in copper to reverse inventory depletion. The LME copper inventory has been falling for months, and just keeps on going: (VIEW LINK). Now Goldman warns that the market is about to tighten. Reuters: Copper spreads on the LME tightened sharply last week as the market finally started reacting to the continued steady erosion of available stocks. A note by Goldman Sachs, advising short position-holders to roll out of the front part of the curve, seems to have acted as a collective wake-up call. Analysts at the bank warned that the benchmark cash-to-three-months time spread CMCU0-3, valued at $83.50 per tonne backwardation at Tuesday's close, could flex out to $100-$150 imminently. Stock trends now hold the key to how tight this market could get. The LME system needs fresh supply, and to get it, the backwardation must move to a level that incentivises deliveries into LME: (VIEW LINK)

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