Copper Price Skyrockets Amid LME Warehouse Squeeze
The copper price has surged to near-record levels due to a combination of factors, including a warehouse squeeze at the London Metal Exchange (LME) and project signals from engineers.
According to recent data, the LME August contract's premium over September has blown out to $370/t, while the cash-to-three-month spread hit $434/t. This is amid a 42-day drawdown in exchange stocks to 204,975 t, nearly half of which is already earmarked for withdrawal.
Traders are diverting metal to the US ahead of potential 15-30% tariffs on refined copper and to China as smelters cut output following the DRC's concentrate export ban. Chilean supply remains constrained around 5.5 Mt/y, while Indonesia's 342,000 t/y Gresik smelter is offline.
BMI now pegs 2026 prices near $13,500/t with 'strong upside risks', as shorts on the LME face the prospect of a warehouse bidding war.