A heated competition for copper among some of the biggest commodity traders is creating opportunities for miners to negotiate favorable terms ranging from huge upfront payments to extra-long contracts.

Recent moves by cash-flush energy traders including Mercuria Energy Group to expand in metals — a market long dominated by Glencore and Trafigura Group — are raising tensions and sparking a scramble for contracts, at a time when the industry is already facing an unprecedented supply squeeze in copper ore.