Copper Surges to Record High on Bullish Forecasts, Mounting Supply Fears

Copper prices surged to a fresh all-time high on Friday, bolstered by increasingly optimistic market forecasts and growing concerns over a looming supply crunch. The benchmark metal jumped 1.2% to $11,581.50 per metric ton, surpassing its previous peak reached earlier in the week.

The rally reflects a powerful combination of speculative momentum, bullish research notes from major banks, and expectations of global disruptions that could widen the gap between supply and demand over the coming years.

In a research note released Friday, analysts at Citi said copper is likely to average $13,000 per ton in the second quarter of 2026, driven by metal stockpiling in the United States and tightening availability elsewhere.

Traders are increasingly bracing for supply interruptions as more copper flows into the U.S. ahead of a possible tariff decision. The market is also digesting the prospect of stricter trade measures after the U.S. signaled potential duties on copper imports.

BloombergNEF added further momentum to the bullish narrative, reporting Thursday that the market is heading into a structural deficit next year, with the supply gap expected to widen throughout the decade due to strong demand and persistent constraints on mining output.

In one of the clearest signs of tightening conditions, Mercuria Energy Group has requested the withdrawal of nearly $500 million worth of copper from London Metal Exchange warehouses, according to people familiar with the matter. It marks the largest single withdrawal from LME inventories in more than a decade.

Citi analysts, including Max Layton, wrote: “We remain strongly bullish on copper into 2026, supported by firmer fundamentals and favorable macroeconomic conditions.”

Despite the frenzy, some analysts urge caution. Macquarie, in a note led by Peter Taylor, said copper remains “highly volatile” and may reach new highs, but argued that prices above $11,000 per ton are not sustainable, given that the global market is not yet facing a true scarcity.

This view aligns with comments from Goldman Sachs earlier in the week, which indicated that a copper shortage is unlikely before 2029, suggesting the current price surge may be running ahead of fundamentals.

Global copper stockpiles have climbed to more than 656,000 tons, the highest since 2018. U.S. COMEX warehouses hold nearly two-thirds of this total—an unusual concentration that has fueled debate over whether copper is genuinely tight or simply being repositioned geographically.

At 11:20 a.m. Shanghai time, copper was last up 1.1% at $11,572.50 on the London Metal Exchange. Other base metals posted modest gains, with aluminum rising 0.1% and zinc up 0.3%.