Albert Mackenzie

Copper prices have hit record high after record high in 2026, and are approaching USD 15,000/t as of 10 September. This is despite 2025’s multi-year high surplus and 2026 looking likely to be a broad surplus too.  Part of the reason prices are not reflecting the strong surplus is that huge flows into the US are making the market feel significantly tighter than it is.  In 2025, so much copper went to the US that Benchmark assessed the market as “feeling” 700kt tighter in 2025 than the actual surplus, and Benchmark expects the perceived tightness to be 880kt lower than the actual surplus in 2026. 

On-warrant copper stocks have risen by 63kt over the last three days, a more than 50% increase. This global rise – seen in Asia, the US and Europe – is a response to the large backwardation that has opened up over the last couple of months, hitting particularly wide-levels in the last week.  Total stocks have pushed up 28kt with deliveries flowing onto the exchange. Beyond this a significant amount of cancelled stock has been re-warranted.  The deliveries caused the LME cash-to-three month spread to fall significantly to around USD 175/t from over USD 550/t at points on Monday.  As of Wednesday 19 August, the LME three-month copper price is at USD 13,885/t, down nearly USD 300/t since Monday.  "The deliveries alleviate the fears of extreme nearby tightness for now, and LME inventories will be closely watched for signals on price movements," said Albert Mackenzie, a copper analyst at Benchmark.

Copper smelter treatment charges (TCs), the charge levied by smelters to process copper concentrates, have hit record lows in recent weeks as a result of years of smelter overcapacity, particularly in China. As of 7th August, copper TCs were at -$173/tonne.  Concentrate supply has not grown quickly enough in recent years to make use of all the additional capacity among smelters, but strong byproduct prices, high premiums, and high copper prices have supported smelters despite dwindling TC proceeds. 

Chilean copper mining group Antofagasta has, according to reports, settled a spot index-linked sale of copper concentrates. This is unusual, as Antofagasta ordinarily sell at set levels rather than floating, spot-linked sales. The company is the de facto negotiator of copper concentrate benchmark treatment charges/refining charges (TCs/RCs), so this update may have significant implications. A decline in importance of the benchmark system would increase focus on spot TCs at a time when the spot market is increasingly tight and the spread between long-term and spot TCs is growing.

The copper market is often feared to be at risk of a structural shortage leading to near term market tightness. However, these concerns have often proved to be overblown as historically the supply gaps have been filled. The slow speed at which new mine supply can come online and the expectation for rapidly growing demand from global electrification and accelerating AI adoption reinforces the narrative, and perhaps the price signal, that copper supply is scarce. However, this view may be too focused on how Western mines and Western companies invest in the copper space. Indeed, over the last 15 years, Chinese companies have demonstrated their ability to deploy capital and ramp up mines around the world faster than the conventional 10–20 years considered standard by countries in the West.

Copper has remained relatively flat since the start of the conflict in Iran, though it has shown some volatility day-to-day. Its apparent steadiness is a result of pressures both upward and downward on its price. Higher interest rates and inflation as a result of the war could add to mining and smelting costs, pushing prices higher. In the short term, however, and with prices generally very high at present, increased borrowing costs could slow demand and exert downward pressure.

Last week, market participants from across the world met in Santiago to discuss the copper market, though at times the conference was more focused on acid than the red metal. Participants were meeting as prices near all-time highs, exchange stocks remain swollen, and TCs continue to fall. There was certainly no shortage of things to discuss in Chile.

China may be looking to impose an export ban on sulphuric acid from May, a move that could put additional pressure on copper and mixed hydroxide precipitate (MHP) producers.

Benchmark analysis of copper demand data highlights the increasing reliance in the West – and particularly in the US – on imported goods. It also draws attention to the proportion of Chinese copper consumption that is due to the export of manufactured goods.

US imports of refined copper grew 81% in 2025, compared to 2024, to a record high of 1,634kt. Driven by tariff fears, these imports were far in excess of US demand for the metal.

The margins of copper miners are at multi-year highs on the back of high copper prices, elevated by-product prices, and record low treatment and refining charges (TC/RCs).

Copper prices broke all-time highs on 29 January 2026, with the three-month LME copper price hitting $14,527.50/tonne. This is the largest single day rise in the copper price since 2008, almost hitting the 12% daily moving limit set by the LME. However, this record level was short-lived, ending the day at $13,720.50/t and fell further when trading reopened on 30 January.