Copper Prices Soar Amid Supply Tightness and Tariffs Uncertainty

Copper prices have surged to an all-time high on the London Metal Exchange, with three-month futures reaching $14,533 per ton. The metal has seen a 17% increase over the past year due to chronic supply tightness and a squeeze on near-term inventories.

The immediate trigger for the price hike is speculation that President Donald Trump will extend tariffs to refined copper imports. Although no decision has been announced, this uncertainty has led traders to ship massive volumes into the US, draining deliverable metal from other markets.

This exodus has left London Metal Exchange warehouses critically depleted, with a major squeeze hitting the market last month. The current state of backwardation, where spot copper trades at a steep premium to three-month futures, signals immediate scarcity.

Longer-term concerns over ageing mines failing to keep pace with demand from data centers, renewable energy, and power grids are also contributing to the price surge. BHP, the world's largest miner, has joined forces with Poland's KGHM in a bid to secure future supply by jointly hunting for new copper deposits worldwide.

The agreement between BHP and KGHM creates a framework for evaluating projects where combining technical capabilities could unlock additional output. The two miners plan to refine priorities before determining where cooperation can deliver tangible value.