In copper and tin, the scale of the backwardations has reached record highs in recent months, exacerbating the sense of panic among industrial users who have been dealing with escalating supply turmoil since the pandemic began.

Signs of tight physical supply across the metals market are also acting as a counterweight to the growing nervousness about the broader macro outlook for major industrial economies, and particularly top commodities consumer China. In the case of aluminum, spreads have tightened significantly over the past month, even as prices slumped from multiyear highs.

Given the diverse uses and supply dynamics for the individual metals, the unusual synchronized tightness across the LME’s six main contracts is a sign of how widespread the logistical turmoil is, and how broad the rebound in demand has been since the early stages of the pandemic, said Oliver Nugent, a base metals analyst at Citigroup Inc.

“A big part of the tightness that consumers are facing is down to logistics, there’s no doubt about it,” Nugent said by phone. “But it’s also indicative of very firm demand.”

To be sure, the across-the-board tightness might not last for long. Backwardations in markets like copper and lead are fading, even as aluminum and nickel spreads become tighter. But one consequence of the supply-chain turmoil is that the price spreads on other global exchanges might tighten further even as the LME market softens, Nugent said.

In the case of copper, for instance, there’s a growing backwardation in Shanghai Futures Exchange contracts, even as LME spreads retreat from all-time highs seen during an unprecedented supply squeeze last month.

Copper futures fell 1.6% to settle at $9,406.50 a metric ton at 5:53 p.m. in London, with deliveries of metal into LME warehouses in the U.S. helping to partially allay concerns about supply in the wake of the squeeze.

Aluminum prices on the LME were 1.6% higher at $2,616.50 a ton, down from above $3,200 a month ago.