Copper is using its longest weekly successful streak since 1994, and the bodily market beneath the rally retains getting thinner.
Benchmark costs on the London Steel Alternate notched a 10th straight weekly gain via final Friday, buying and selling close to $14,300 a ton and inside attain of the record $14,527.50 set in January. On Comex, costs topped $6.70 a pound in August, a contemporary all-time excessive. Behind the run sits stock that retains draining: LME warehouse shares fell for 42 straight days via mid-August, the longest stretch since 2014, and practically half of what is left is already earmarked for withdrawal.
Tuesday marks a yr for the reason that catastrophe that helped set this squeeze in movement. On Sept. 8, 2025, roughly 800,000 tons of moist materials flooded Freeport-McMoRan’s Grasberg mine in Indonesia, the world’s second-largest copper supply, killing two staff and forcing a power majeure that is nonetheless working via the availability chain. Freeport has minimize 2026 output steerage on the advanced by roughly a 3rd, and a full restoration is not anticipated earlier than 2027 or 2028.
International Copper Study Group knowledge present world mine output fell 1.1% within the first half of the yr, with Codelco and Freeport each posting double-digit declines. Chile, the world’s high producer, logged its weakest second quarter in at the very least 19 years and has cut its 2026 forecast twice, to a 2.6% decline. Codelco’s Andes Norte enlargement at El Teniente, meant to assist offset losses from final yr’s deadly tunnel collapse, isn’t due to reach production until 2029.
“It is declining grades at current operations. It is drained, very, very previous belongings,” BlackRock’s Evy Hambro mentioned of the sector final month.
Then in early August, Congo added a brand new wrinkle, banning exports of copper and cobalt concentrate to power extra processing onshore. The order impacts a small slice of Congo’s copper commerce, most of which already leaves the nation as refined cathode, nevertheless it nonetheless pushed LME costs up 1.8% the day it grew to become public. Reuters columnist Andy House referred to as the response proof that “Doctor Copper’s panic attack is unlikely to be the last.”
The Commerce Department’s deadline to recommend whether to extend tariffs on refined copper handed June 30, and greater than two months later, the White Home nonetheless hasn’t determined. Merchants aren’t ready: roughly 200,000 tons of refined copper flooded into the U.S. in July alone, the most important month-to-month influx on file, pushing Comex inventories previous 1 million tons as patrons race to beat a potential 15% responsibility that might take impact as quickly as January.
None of this factors to an instantaneous scarcity of refined metallic…
Morgan Stanley nonetheless expects refined output to inch up virtually 1% this yr even with mines producing much less, as smelters lean more durable on scrap. Mine provide is the larger fear, and Wall Avenue is break up on how unhealthy it will get. Citigroup sees copper reaching $15,000 a ton by year end, and as excessive as $17,000 if AI-driven demand or a producing rebound outpaces what the bottom can ship.
“Everyone seems to be investing in copper, everybody likes copper,” Anglo American’s Ruben Fernandes mentioned. Provide, he added, will come. The query is how shortly.
By Michael Kern for Oilprice.com
