Copper Prices Soar to Record Highs Amid Supply Shortages

Copper prices have reached record highs due to a combination of factors, including weak mine output, policy risks in key producing countries, and growing demand from industries like data centers and electric vehicles.

Comex futures traded above $6.80 per pound in recent sessions, while London market prices hit nearly $14,500 per tonne. The physical market is also showing signs of a squeeze, with copper spreads repeatedly moving into backwardation this year.

The weak mine output is particularly concerning, as it's coming from major producers like Chile and Indonesia. Chilean mine production is expected to fall 2% in 2026 due to lower ore grades, scheduled maintenance, operational constraints, and a weak start to the year. Indonesia's supply risk is also significant, with Freeport-McMoRan's Grasberg complex being one of the copper market's major pressure points.

The Democratic Republic of Congo has imposed an export ban, which will further reduce global supply. This policy risk is not new, as the Congolese government has used export controls before to push miners to process more ore at home rather than ship raw concentrate straight out the door.