Copper's upward momentum is showing signs of strain. After surging past a key psychological threshold earlier this week, prices are now consolidating as the market weighs dwindling supply against the cooling effect of elevated costs on buyers. Main Developments On Wednesday, three-month copper on the London Metal Exchange edged up 0.18% to $14,091.5 per metric ton by 0700 GMT. The Shanghai Futures Exchange's most-traded contract performed more strongly, climbing 0.96% to 107,340 yuan ($15,908.82) per ton. Tuesday's session saw prices break above $14,000 for the first time since early June, hitting a two-month high. That milestone came as market sentiment improved on easing fears of Middle East escalation, alongside a more favorable macroeconomic outlook. Read also: Chip rally drives KOSPI to weekly high as oil eases Supply fundamentals are tightening. Stocks in LME-registered warehouses have dropped nearly 40% since the end of May, reflecting a surge of material being diverted to the U.S. ahead of potential tariffs on refined copper. ANZ senior commodity strategist Daniel Hynes noted that U.S. imports exceeded 200,000 tons in July, the largest monthly inflow since 2014. Background The physical market's tightness is visible in the LME's cash-to-three-month spread, which sits in a backwardation of $102.38 per ton — a signal that buyers are paying a premium for immediate delivery. That dynamic has been building for months as traders repositioned inventories ahead of the tariff threat. Why It Matters Demand is beginning to push back. Everbright Futures analysts have flagged concerns about the strength of second-half seasonal demand, noting that high prices are starting to weigh on buyers. The Yangshan copper premium, a key gauge of physical demand in top consumer China, slipped to $110 a ton on Tuesday, according to data provider SMM. The tension between supply constraints and price-sensitive demand will determine whether the rally has further room to run. Other metals showed mixed movement, with LME zinc gaining 0.94% and lead adding 0.37%, while nickel slipped 0.42%. On the SHFE, lead jumped 2.77% and zinc rose 1.88%, against a 0.79% decline in nickel. What's Next Traders will watch whether the Yangshan premium stabilizes or slides further, which would signal how much pain Chinese buyers can absorb. The tariff-driven U.S. import wave may also slow once the policy picture becomes clearer, potentially reshaping global inventory flows in the coming months.