Copper Prices Volatile Amid US-Iran Tensions

Copper prices are expected to remain volatile in the coming months due to ongoing tensions between the US and Iran, according to analysts from BMI. The current rally is already extending beyond what fundamentals alone would justify, with a more constructive backdrop on both geopolitical and macro fronts needed before downside risks can be entirely ruled out.

The conflict has put pressure on copper supplies, which are already tight due to ongoing supply disruptions, strong import demand, and falling exchange stocks. This has pushed prices to a six-week high, with the three-month contract on the London Metal Exchange (LME) currently quoted around $13,800 a tonne.

However, concerns over global growth and inflation have limited further gains, with ING Think warning that copper demand may slow in 2026 amid geopolitical uncertainty and softer economic conditions. BMI has raised its copper price forecast to $12,700/tonne, citing sustained support from converging supply-side pressures and tariff-driven tightness.

The Yangshan premium, which measures the import cost of copper into China, surged to $100/tonne in April, its highest level in over a year. This is due to tightening physical market conditions in China, where Beijing's crackdown on invoice trading has disrupted scrap flows and constrained domestic supply.