Key facts
- Copper prices are on their longest weekly winning streak since 1994, trading near record highs.
- LME warehouse inventories have fallen for 42 consecutive days, with nearly half of remaining stock earmarked for withdrawal.
- A force majeure at Freeport-McMoRan's Grasberg mine in Indonesia, following a disaster in September 2025, has impacted supply and future output guidance.
- Global mine output declined in the first half of the year, with major producers like Codelco and Chile showing significant decreases.
- Congo's ban on copper concentrate exports, though affecting a small portion of trade, added upward pressure to prices.
- U.S. refined copper imports hit a record high in July as buyers anticipate potential tariffs.
Copper prices are surging, marking the longest weekly winning streak since 1994, driven by a tightening physical market. Benchmark prices on the London Metal Exchange have approached record levels, trading near $14,300 a ton, while Comex prices have set new all-time highs. This rally is underpinned by rapidly depleting inventories, with LME warehouse stocks experiencing their longest daily decline since 2014.
Supply disruptions are a key factor. A significant disaster at Freeport-McMoRan's Grasberg mine in Indonesia in September 2025, the world's second-largest copper source, resulted in a force majeure and has led to reduced output guidance for future years. Global mine output has fallen, with major producers like Codelco and Chile reporting substantial declines. Chile, the top producer, has seen its weakest second quarter in nearly two decades and has lowered its 2026 forecast.
Further supply concerns have emerged from Congo's recent ban on copper and cobalt concentrate exports, aimed at boosting domestic processing. While this affects a small portion of Congo's trade, it contributed to a price increase on the day of the announcement. Analysts note that declining ore grades at existing operations and aging assets are contributing to the supply squeeze.
Despite these supply constraints, some market participants anticipate a modest increase in refined output this year, largely due to increased reliance on scrap metal. However, mine supply remains a significant worry, with analysts holding differing views on the severity of future shortages. Some foresee copper prices reaching $15,000 a ton by year-end, with potential for higher levels if demand from AI or a manufacturing rebound outpaces available supply. The U.S. has also seen a record inflow of refined copper in July, as buyers prepare for potential tariffs.