Copper prices are climbing as tighter supply, lower available inventories and expanding demand from power infrastructure and data centres strengthen the market backdrop.
Benchmark three-month copper on the London Metal Exchange reached a record US$14,635 a tonne after four consecutive sessions of gains. The move comes as mine production weakens and buyers position ahead of possible changes to US trade policy, increasing competition for immediately available metal.
One of the main near-term drivers is uncertainty surrounding potential US tariffs on refined copper. The US already applies a 50% tariff to certain semi-finished copper products, including wires and pipes, while refined copper remains exempt. The possibility that refined metal could eventually face additional tariffs has encouraged more copper to move into the US market before any policy change takes effect.
Those flows are tightening supply elsewhere. Copper entering US inventories is effectively being removed from other markets, reducing stocks in London Metal Exchange warehouses outside the US. The futures market has also moved into steep backwardation, with near-term contracts trading above later-dated prices.
Mine production is reinforcing that tighter market structure. Global copper mine output declined by 1.1% during the first half of 2026, leaving the industry at risk of recording its first annual production decline since 2017 unless production improves during the second half. Chile, the world’s largest copper producer, also reported a 9.4% year-on-year decline in July output following severe storms.
These supply constraints are developing while copper’s long-term demand base continues to broaden. The metal is essential across electrical equipment, machinery, vehicles and power networks, placing it at the centre of continued investment in electrification.
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