Copper prices projected to reach $11,700 per metric tonnes amid supply concerns
Copper prices are heading for a big jump, potentially hitting $11,700 per metric tonne, as strong demand clashes with limited supply. That’s according to a new report released on Friday, highlighting how the global copper market is feeling the squeeze.
Just recently, prices took a small dip of 0.32% after spiking more than 5% due to a mudflow disaster at Freeport-McMoRan’s massive Grasberg mine in Indonesia—the world’s second-largest copper operation. This incident has traders on edge, blaming a 3-4% drop in expected global copper mine output from the site, which could wipe out over 250,000 tonnes from 2025 production totals.
On Thursday, India’s MCX copper futures for September delivery climbed to Rs 950, while London Metal Exchange (LME) futures pushed up to around $10,300 per tonne. Overall, copper prices have surged nearly 20% so far this year, driven by tighter supplies and booming demand tied to the world’s shift to green energy.
“The rally comes from all the electrification efforts, like electric vehicle adoption, upgrading power grids, installing renewables, and the explosion in AI-powered data centers—all of which guzzle copper,” explained Navneet Damani, head of commodity research at Motilal Oswal Financial Services Ltd. (MOFSL).
Supply woes are piling up beyond the Grasberg setback. Refining snags and a shortage of copper concentrate are slowing down new mine projects from turning into actual refined metal, Damani noted. This has pushed stockpiles to their lowest in years, well below the five-year average. In the first seven months of the year, the market showed just 101,000 tonnes of surplus, a sharp drop from the 401,000 tonnes surplus in the same period last year.
Freeport-McMoRan has declared force majeure on copper shipments from Grasberg and paused key block-cave mining operations indefinitely. Adding to the pressure, China cut its refined copper production by 5% in early September, potentially removing about 500,000 tonnes from the global market.
Copper mining companies stand to gain big from these higher prices, with experts at MOFSL predicting solid profits ahead in the copper sector.
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