Copper climbs toward all-time high on 10-week rally

Copper prices on the London Metal Exchange climbed toward their all-time high last week, with benchmark three-month copper reaching $14,441.50 per metric tonne and rising for a tenth consecutive week, according to Shanghai Metals Market. The rally, driven by falling inventories outside the United States and declining output from key mining regions, has brought the metal within striking distance of its record of $14,527.50 per tonne.investmentguruindia+1

Supply Squeeze Intensifies

A confluence of supply-side pressures has kept copper prices elevated. LME-registered warehouse inventories stood at 234,175 tonnes as of early September, while inventories on the Shanghai Futures Exchange fell by more than 9,400 tonnes to 63,000 tonnes, signaling tighter conditions in the Chinese market. Meanwhile, COMEX warehouse stocks have ballooned to 766,795 tonnes as record volumes of copper flow into the United States ahead of potential tariffs.thevaultreport+1

U.S. copper imports hit a record 225,094 metric tonnes in July, according to Kitco, as traders rushed to ship metal before any new duties take effect. The Democratic Republic of Congo's ban on copper and cobalt concentrate exports, first reported by Reuters ↘ 1.75% in August, has added to concerns about feedstock availability for international smelters.reuters+1

Demand Broadens, but Headwinds Persist

Rising consumption in India and industrial recovery in Europe are broadening the global demand base, according to FX Empire. Data centers and power grids have also emerged as major demand drivers, with J.P. Morgan projecting a refined copper deficit of 330,000 metric tonnes for 2026, while Morgan Stanley forecasts a shortfall as large as 600,000 tonnes — the largest in more than 20 years.fxempire+2

However, gains have been partially capped by a stronger U.S. dollar after August nonfarm payrolls of 162,000 jobs far exceeded expectations of 56,000, reigniting expectations for a Federal Reserve rate hike at the September 15–16 meeting. Escalating tensions between the United States and Iran, including strikes on Iranian oil tankers, have also weighed on broader market sentiment.news.metal

Prices May Need to Go Higher

Industry experts argue that even current near-record prices may not be enough to close the structural supply gap. Colorado School of Mines' Payne Institute noted that the financial risk of developing new mines means "prices will need to go much higher before mining companies see profit in addressing the supply shortage". S&P Global ↘ 0.49% has projected the copper supply deficit could reach 10 million metric tonnes by 2040 as demand surges 50%, underscoring the scale of investment needed to bring new production online.payneinstitute.mines+1