Copper Prices Reach Near-Record High Amid Supply Disruptions

Copper prices have been hovering near a record high of $6.7 per pound in the US, driven by concerns over supply disruptions and tariffs. The ongoing escalation of strikes between the US and Iran has led to a suspension of commercial vessel flows through the Strait of Hormuz, exacerbating shortages of sulfuric acid for refiners in key South American hubs.

The situation was worsened by China's halt on exports due to supply pressures from GCC countries. Additionally, concerns that the US presidential administration may impose tariffs on unprocessed copper goods have triggered a surge in buying to front-load deliveries.

This has led to steepened backwardation curves in major Western copper exchanges and faltered mined supply, with reports of double-digit declines in production from Codelco and Freeport-McMoRan. Global production declined by 1.1% in the first half of the year, according to the International Copper Study Group.