VMRF METAL MARKET BULLETIN: NON-FERROUS METAL MARKETS RISE SHARPLY, WITH HIGH VOLATILITY

VMRF Metal Market Bulletin – Updated through August 11, 2026

The international non-ferrous metals market entered mid-August 2026 with a clear upward trend, with copper remaining the market’s main focus. LME copper prices have moved above USD 14,000 per tonne, while aluminum and zinc have also recorded significant gains. Lead has recovered, but at a slower pace than other base metals.

The rally has taken place against a backdrop of declining exchange inventories for several metals, tightening spot supply, and heightened market sensitivity to potential supply disruptions. However, current price movements are not being driven solely by physical supply and demand. Financial flows, market expectations, and geopolitical factors are also having a significant influence.

This makes the scrap market increasingly complex. Higher primary metal prices provide support for scrap prices, but this does not mean scrap prices or business margins will necessarily rise at the same rate.

Copper Leads the Market Rally

According to LME data through August 11, the copper cash settlement price reached USD 14,424.5 per tonne, while the three-month price stood at USD 14,217 per tonne. LME copper inventories fell to 214,550 tonnes, from 249,850 tonnes at the end of July.

The most notable feature is the cash price trading more than USD 200 per tonne above the three-month contract. This indicates relatively strong pressure in the spot market. The LME states that its Official Prices are derived from trading on the Ring and serve as global reference prices for physically delivered metals. (lme.com)

The situation has been reinforced by concerns over copper supply following the Democratic Republic of Congo’s decision to restrict exports of copper and cobalt concentrates. Reuters reported that the move by the DRC contributed to a sharp rise in copper prices, while falling LME inventories and increasingly tight raw material availability for smelters have added to market pressure. (reuters.com)

However, current price levels also reflect market expectations and financial flows. Companies involved in metals trading and recycling should therefore be particularly cautious about chasing prices higher, especially when they do not have secured sales contracts or an appropriate price-locking mechanism.

Aluminum Rises but Does Not Yet Show the Same Spot Tightness as Copper

The aluminum cash settlement price reached USD 3,373 per tonne on August 11, up approximately 3.5% from the beginning of the month. LME inventories declined from 262,650 tonnes to approximately 253,400 tonnes.

Although inventories have fallen, the difference between the cash price and the three-month price is negligible. This indicates that the aluminum market does not currently show the same clear degree of spot tightness seen in copper.

The outlook for aluminum will continue to depend heavily on smelter production, energy costs, logistics, and the ability of major producing regions to maintain supply. The LME continues to publish inventory, pricing, and aluminum futures market data as important indicators for the global physical market. (lme.com)

For recyclers, this is another reason not to rely solely on movements in primary aluminum prices when determining scrap purchasing prices. Scrap quality, recovery rates, sorting costs, and individual plant demand can create substantial differences.

Zinc Shows Clear Signs of Short-Term Tightness

Zinc is the second metal, after copper, showing a particularly notable price structure. The cash settlement price reached USD 3,822 per tonne, approximately USD 81 per tonne above the three-month price.

This spread indicates that spot availability is relatively tight. Against a backdrop of closely monitored exchange inventories and physical supply conditions, zinc could remain highly volatile in the short term.

However, the medium-term outlook will depend on smelter production and the potential for supply to recover, particularly in China. LME data for August 11 also indicate that the zinc market requires close monitoring of both spot prices and the forward curve. (lme.com)

Lead Recovers, but High Inventories Remain a Constraint

Unlike copper and zinc, the lead market has not shown a comparable acceleration. The lead cash settlement price was USD 1,878 per tonne on August 11, while the three-month price was approximately USD 1,907 per tonne.

LME lead inventories stood at around 420,300 tonnes, significantly higher than inventories of the other metals discussed in this bulletin. This remains a factor limiting the upside potential for lead in the short term.

In Vietnam, the LME price is only one of several variables determining physical lead prices. Premiums, raw material costs, logistics, recovery rates, and demand from battery manufacturers, lead smelters, and recycling facilities can cause domestic transaction prices to move substantially differently from international reference prices.

The LME also confirms that lead is one of the base metals tracked through pricing, inventory, and futures market data. (lme.com)

U.S. Copper Tariffs Should Not Be Interpreted as a Blanket 50% Tariff on All Imported Copper

U.S. trade policy remains an important factor for the global copper market. However, businesses need to distinguish clearly between refined copper, semi-finished copper products, and derivative products containing copper.

According to the White House, the United States imposed a 50% Section 232 tariff on certain semi-finished copper products and copper-intensive derivative products from August 1, 2025. The scope is determined according to specific product categories and HTS codes rather than applying uniformly to every form of imported copper. (whitehouse.gov)

The regulations have continued to evolve in 2026. A presidential proclamation issued in April 2026 established a 50% ad valorem tariff on certain copper products covered by Section 232 and derivative products identified in the relevant annexes. (whitehouse.gov)

Vietnamese companies exporting or trading copper products connected to the U.S. market should therefore not use the general statement “50% copper tariff” to directly infer selling prices or customs treatment. The HS code, product description, and specific scope of the applicable regulation are the basis for determining the actual tariff obligation.

Higher Primary Metal Prices Do Not Automatically Mean Scrap Prices Will Rise at the Same Rate

For the recycling industry, this may be the most important issue in the current market environment.

When copper, aluminum, and zinc prices rise, scrap prices generally receive upward support. However, scrap prices do not move entirely in line with LME prices.

The value of a copper scrap shipment varies according to copper content, impurity levels, recovery rates, material form, transportation costs, processing costs, and the requirements of the receiving plant. Premiums or discounts in individual markets can also move faster or slower than LME prices.

For scrap traders, the critical issue is therefore not simply the LME price at the time of purchase, but also the pricing formula and price-fixing date.

A company that purchases scrap at elevated prices without a secure sales outlet may face significant risk if the market reverses.

Conversely, a company with stable sales contracts, rapid inventory turnover, and an LME-linked pricing mechanism can manage risk more effectively even during periods of sharp market volatility.

Risk Management Is Becoming Critical to Protecting Margins

Under current market conditions, metal recyclers and traders need to shift their focus from simply predicting prices toward managing price spreads and exposure.

Contracts should clearly specify whether the reference price is LME cash or the three-month LME price, the price-fixing period, recovery rates, premiums or discounts, and related costs. For scrap materials, clearly defining quality standards and inspection methods is equally important.

Companies should also avoid building inventory solely on the expectation that prices will continue rising. When markets are strongly influenced by financial flows and geopolitical developments, a reversal can cause primary metal prices to fall faster than scrap prices adjust.

Monitoring LME inventories, the cash-to-three-month structure, physical premiums, raw material availability, and plant demand simultaneously will provide a much more complete market signal than simply following quoted prices.

VMRF: Opportunities Remain Significant, but Risks Are Rising

The non-ferrous metals market in mid-August 2026 is showing clear differentiation among metals. Copper and zinc are displaying stronger signs of short-term spot tightness, while aluminum is supported by declining inventories but has not yet developed the same degree of supply tightness. Lead continues to face pressure from high inventory levels.

From VMRF’s perspective, this is not a market in which businesses should simplify their strategy to “rising metal prices mean rising scrap prices.”

Opportunities remain, but the ability to convert those opportunities into profits depends heavily on material quality, sorting and recovery capabilities, inventory turnover, cash flow, sales contracts, and pricing mechanisms.

For Vietnam’s metal recycling industry, current volatility also highlights the growing importance of developing transparent pricing formulas that link scrap prices to recognized metal benchmarks while properly reflecting material quality, processing costs, and domestic supply and demand conditions.

In a market where copper prices have moved above USD 14,000 per tonne, effective risk management may be just as important as the ability to forecast the direction of prices.

Note: This bulletin is based on market data and information from verifiable sources. The analysis is provided for market and business reference purposes only and does not constitute investment advice or a commitment regarding future price trends.

Sources: London Metal Exchange (LME); Reuters; The White House; international metals market data updated through August 11, 2026. The LME confirms that its Official Prices serve as global reference prices for physically delivered metals and publishes pricing, inventory, and futures market data through its market system. (lme.com)