Copper Hits Record High as Tight Supply and U.S. Tariff Fears Lift Prices

Copper reached another record price for a second successive trading day, driven by tight immediate supply along with the threat of U.S. duties on imported refined copper products.  

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The industrial metal marked its fourth consecutive day of gains at the London Metal Exchange, where prices touched a record $14,617 a tonne. Prices of copper have surged about 17% year-to-date due to a prolonged period of supply-demand mismatch between limited mining production and increasing usage in data centers, renewables and power infrastructure. 

Why the market is so tight right now 

The immediate squeeze has a more specific cause. Large quantities of refined copper have been moving to the United States, where prices have been running higher on tariff expectations. The result is that LME warehouse inventories have been depleted, causing a serious pinch last month, and driving the futures curve into deep backwardation, a state indicating a lack of easily obtainable metal. 

China, the biggest copper buyer worldwide, is anticipated to contribute to the increase in demand since its production industry will be approaching the season in which it usually peaks. Inventories in Shanghai Futures Exchange warehouses fell last week to their lowest level since 2024. 

Jia Zheng, a trading manager at Suzhou Chuangyuan Harmony-Win Capital Management Co, sees little to stop copper reaching $15,000 and reports that order flow from State Grid Corp. of China looks strong, going by conversations with clients. 

Supply concerns are also building on the mining side. Operational problems at several major projects mean global mined production could post its first annual decline since 2017 unless output improves in the second half of the year. 

Prices at a glance 

Three-month copper futures were up 0.5% at $14,581 a ton on the LME at 11:08 am in Singapore, having gained as much as 0.7% earlier in the session. Zinc rose 1.1% and aluminium edged up 0.1%. Iron ore futures in Singapore added 0.8% to $101.10 a ton.