Copper Prices Soar to Record High Amid Tariff Fears and Surging Demand

Copper prices have surged to an all-time high on the London Metal Exchange, reaching $14,533 per tonne in benchmark three-month futures. This represents a 17% increase over the past year and has left copper well above earlier analyst expectations.

One reason for this rally is the fear of US tariffs. Traders are moving large quantities of copper into the US to avoid potential future taxes, resulting in a surge of imports, with 885,000 tonnes entering the country during the first half of 2026.

Copper stocks held in Comex warehouses have also reached a record high of 675,000 tonnes. This concentration of global inventories in the US has led to a decline in LME network stocks.

The copper market is facing a longer-term supply-demand imbalance due to ageing large-scale mines struggling to increase output quickly enough to meet rising consumption. Several major producers have faced operational challenges, such as Chile's copper shipments falling to their lowest level in over a year in August despite increased prices.

New demand drivers include the rapid expansion of artificial intelligence infrastructure and investments in power grids, renewable energy projects, and battery storage. Electric vehicles also require significantly more copper than conventional vehicles, with industry estimates suggesting they use roughly six times as much.