Copper prices witnessed a sharp retracement on Wednesday after achieving their longest winning streak since 2017, with the metal experiencing significant volatility following an exceptional rally that positioned it for the largest yearly increase since 2009. The pullback comes after copper surged almost 40% this year, setting multiple all-time highs in its end-of-year rally.

Sharp Intraday Correction Follows Record Rally

On the Multi Commodity Exchange (MCX), copper futures for January 30, 2026 expiry were trading at Rs 1,298.95, down Rs 38.40 or 2.87% intraday. Earlier in the day, prices fell to a low of Rs 1,261.00, marking a 5.7% drop from Tuesday's close and representing a significant correction from recent highs.

Despite this pullback, copper has seen an exceptional run through the year. The metal notched its longest winning streak since 2017, rising for eight consecutive sessions in December and peaking just below $13,000.00 per tonne. On the London Metal Exchange (LME), copper breached the $12,600.00 per tonne mark, with 3M LME copper settling at $12,635.55, reflecting strong performance despite recent volatility.

Supply Disruptions Continue to Drive Market Dynamics

According to Jigar Trivedi, Senior Research Analyst at Reliance Securities, supply concerns have been a key driver of the recent surge. Traders have increasingly moved metal into the US in anticipation of potential tariffs, tightening availability in other regions and creating significant market distortions.

Multiple disruptions in major producing countries such as Indonesia, Chile, and the Democratic Republic of the Congo have weighed on global supply. In November, Mercuria Energy Group flagged the possibility of a severe copper shortage worldwide in 2026, adding to supply-side concerns that have supported the metal's rally.

Technical Levels and Currency Support

Trivedi also pointed to the role of a weaker US dollar, which has made metals cheaper for buyers using other currencies. The dollar has depreciated by approximately 8.00% in the year, lending further support to commodity prices and contributing to copper's strong performance.

As per Manoj Kumar Jain of Prithvifinmart Commodity Research, copper prices are showing high volatility and solid strength, rebounding from previous session sell-offs amid supportive macro factors and demand expectations for 2026. He noted that domestically, the MCX copper January futures contract has support at Rs 1,205.00 to Rs 1,271.00, while resistance is seen between Rs 1,374.00 and Rs 1,410.00.

Market Outlook Amid Perfect Storm Conditions

While copper has cooled off from its recent highs, analysts maintain that the overall market environment continues to be shaped by a "perfect storm" of supply chain stress, an optimistic macroeconomic outlook, and speculative interest, particularly in the context of global industrial recovery and electrification demand.

The outlook for copper remains closely tied to movements in the dollar index, potential policy decisions from the US Federal Reserve, and ongoing geopolitical developments, all of which are expected to influence metal prices in the near term. The combination of structural supply deficits and strong demand from energy transition applications continues to support the long-term bullish outlook despite short-term volatility.

Hindustan Copper Ltd (HCL) has taken a significant step towards expanding its operations in the copper and critical minerals sector. The company recently signed a Memorandum of Understanding (MoU) with NTPC Mining Ltd (NML), marking the beginning of a potentially game-changing partnership in the mining industry.

Key Points of the Collaboration

• Joint Participation: HCL and NML will collaborate on copper and critical minerals block auctions.
• Operational Scope: The partnership covers exploration, mining, and mineral processing activities.
• Investment Strategy: Both companies will explore joint investment opportunities for developing HCL's existing assets.
• Future Projects: The MoU also encompasses collaboration on upcoming domestic and overseas projects in copper and critical minerals.

Strategic Implications

This partnership between HCL, a government enterprise, and NML, a subsidiary of the state-owned power giant NTPC, signifies a strategic move to strengthen India's position in the copper and critical minerals sector. The collaboration could potentially lead to:

1. Enhanced exploration and exploitation of mineral resources
2. Improved operational efficiencies through shared expertise
3. Increased domestic production of copper and critical minerals
4. Strengthened supply chain for these essential materials

Financial Context

While the MoU doesn't directly impact HCL's immediate financials, it's worth noting the company's recent financial position:

The company's growing asset base and shareholder capital indicate a strong foundation for undertaking new ventures and partnerships.

Conclusion

The MoU between Hindustan Copper and NTPC Mining represents a strategic alignment of two state-owned entities, potentially paving the way for significant advancements in India's mining sector. As the collaboration unfolds, it will be interesting to observe its impact on HCL's operations, financial performance, and the broader landscape of copper and critical minerals production in India.