Copper prices have surged to record levels, capping their strongest annual performance in more than a decade as supply fears, tariff risks and long-term demand trends collide.
On a year-to-date basis, copper is up more than 35%, putting it on track for its best annual gain since 2009. Prices crossed the $12,000-a-tonne threshold for the first time this week, extending a powerful rally. Three-month copper on the London Metal Exchange hovered near record territory on Wednesday, trading around $12,076 a tonne, after touching an all-time high of $12,159.50 in the previous session.
A major driver has been the prospect of US import tariffs. Anticipating higher costs, US buyers have been accelerating purchases and stockpiling copper in warehouses, boosting inventories and creating arbitrage opportunities. At the same time, long-standing supply concerns have intensified. Fatal accidents and disruptions at major mines in Indonesia, the Democratic Republic of Congo and Chile have constrained output, while China’s leading copper smelters are expected to cut production by more than 10% in 2026 to address overcapacity and squeezed processing margins.
Demand fundamentals remain supportive. Electrification, renewable energy investment and grid upgrades all require large volumes of copper, while the rapid expansion of artificial intelligence is driving electricity consumption higher, adding to long-term demand expectations.
Forecasts, however, diverge. Citigroup has suggested copper could climb as high as $15,000 a tonne in a bullish scenario driven by a weaker dollar and US rate cuts. Morgan Stanley expects demand to exceed supply by around 600,000 tonnes next year, with deficits deepening thereafter. By contrast, Goldman Sachs cautions that the recent surge reflects speculative positioning around future shortages rather than immediate supply-demand imbalances.
In India, copper prices have mirrored the global rally. MCX copper rose around 1.8% on Wednesday to ₹1,141.45 per kg. Analysts at ICICI Direct expect prices to remain supported by tight supply conditions and robust US demand, with further upside possible if key resistance levels are breached.
Overall, copper’s record run underscores its role as a bellwether for global growth, industrial demand and the shifting dynamics of trade and energy transition.
