Copper Hits All-Time High Above $13,000 As Supply Crisis Deepens Globally
Copper prices have surged to record levels above $13,000 per tonne, driven by a perfect storm of supply disruptions including mine strikes and operational setbacks, combined with structural demand growth from AI infrastructure, electric vehicles, and renewable energy projects. US tariff concerns have created inventory displacement, with COMEX stocks surging 4.4 times while LME inventories dropped 48%, leading to a forecast deficit of 150,000 tonnes and potential price targets of $15,000 per tonne.
*this image is generated using AI for illustrative purposes only.
Copper has surged to all-time highs above $13,000 per tonne, with three-month futures reaching $13,387.50 on the London Metal Exchange amid a perfect storm of supply disruptions and surging demand from AI infrastructure, electric vehicles, and renewable energy projects. The red metal's extraordinary rally reflects a fundamental shift in global supply dynamics as inventories get "locked in" the US due to tariff concerns.
Record Rally Driven By Structural Demand Shift
The latest surge builds on copper's breakthrough performance, with prices jumping 61.00% on India's MCX and 42.00% internationally, followed by an additional 7.00% gain. This rally is being powered by a rare convergence of forces, as demand gets structurally reshaped by AI data centers, electric vehicles, renewable energy projects, and power grid expansion.
| Price Performance: | Current Level | Change |
|---|---|---|
| LME Three-Month: | $13,387.50 per ton | +3.10% (record) |
| MCX Rally: | 61.00% gain | Strong momentum |
| International Gains: | 42.00% increase | Broad-based strength |
| Additional Gains: | 7.00% further | Continued momentum |
"Copper is trading near its highs because the market sees a real supply squeeze instead of a short-term trade. LME inventories have dropped nearly 48.00% since the start of the year," says Naveen Mathur, Director - Commodities, Currencies and GIFT IFSC at Anand Rathi. "Deficits of over 100,000 tonnes are expected."
Global Supply Crisis Intensifies
Global supply faces unprecedented strain from multiple disruptions. A wave of mine disruptions, from force majeure at Indonesia's Grasberg mine accounting for nearly 3.00% of global output, to strikes in Chile and operational setbacks in the Democratic Republic of Congo, has severely tightened availability. The crisis deepened with a strike at Capstone Copper's Mantoverde mine in northern Chile and delays at Tongling Nonferrous's Ecuadorian mine.
| Supply Disruptions: | Impact | Status |
|---|---|---|
| LME Stocks: | 142,550 tons | Lowest since November 17 |
| Inventory Drop: | 48.00% decline | Since early year |
| Market Deficit: | 150,000 tonnes | Forecast |
| Grasberg Mine: | 3.00% global output | Force majeure |
"Copper has surged to record levels above $13,000 per tonne amid tight supply, major mine disruptions and strong demand from electrification, EVs, AI data centres and grid upgrades, outpacing supply growth," says Justin Khoo, Senior Market Analyst - APAC at VT Markets.
US Tariff Concerns Reshape Global Flows
Geopolitics has amplified the rally as fears of US tariffs on refined copper have diverted massive shipments into American warehouses. COMEX inventories have surged approximately 4.40 times compared to early levels, experiencing 44 straight days of inflows, while draining stocks from London and Shanghai trading hubs.
| Inventory Shifts: | Current Status | Change |
|---|---|---|
| COMEX Warehouses: | 4.40x increase | Massive inflows |
| Inflow Streak: | 44 straight days | Unprecedented |
| Cash Premium: | $39 per ton | Supply stress indicator |
| Market Structure: | Backwardated | Near-term tightness |
"Traders are increasingly concerned that the Trump administration could introduce new tariffs on refined metals, diverting shipments into the US and leaving major trading hubs such as London and Shanghai short of supply," warns Jigar Trivedi, Senior Research Analyst at Reliance Securities.
Electrification Demand Powers Long-Term Growth
Demand continues its structural transformation as India's copper consumption is set to accelerate with data center capacity expanding to 4-8 GW by 2030. The energy transition shows no signs of slowing, with power grid upgrades, renewable energy projects, and AI infrastructure creating unprecedented copper intensity requirements.
| Demand Drivers: | Growth Potential | Timeline |
|---|---|---|
| India Data Centers: | 4-8 GW capacity | By 2030 |
| AI Infrastructure: | High copper intensity | Ongoing |
| EV Adoption: | Structural growth | Multi-year |
| Grid Expansion: | Massive requirements | Long-term |
"Prices are also being supported by a robust global demand outlook, particularly from power grid upgrades, renewable energy projects, and data center expansion," Trivedi notes. Even as China's property sector struggles, consumption linked to electrification and digital infrastructure has proven resilient.
Price Targets Point To $15,000 Per Tonne
Mathur sees prices potentially reaching $15,000 per tonne in the medium term. "Limited new mine supply, lower ore grades, and long project timelines are keeping the market tight," he explains. ICICI Direct expects pullbacks toward ₹1,050-₹1,000 levels on MCX to present accumulation opportunities, with targets of ₹1,450-₹1,500 on the upside.
| Price Outlook: | Target Levels | Rationale |
|---|---|---|
| Medium-term Target: | $15,000 per tonne | Supply constraints |
| MCX Accumulation: | ₹1,050-₹1,000 | Pullback opportunities |
| MCX Targets: | ₹1,450-₹1,500 | Upside potential |
| Long-term View: | Structurally bullish | Energy transition |
"Unlike silver's blend of industrial and precious-metal investment demand, copper's surge is rooted in industrial fundamentals, energy transition, EVs and AI infrastructure," explains Khoo. The LMEX Index tracking main base metals has surged to the highest level since March 2022, with aluminum reaching three-year highs and broad-based participation across the metals complex.
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