London Metal Exchange copper three-month prices are trading near $13,800 per tonne in early June, close to the all-time high of $14,527/t reached on January 29, 2026. The red metal has gained approximately 35% year-to-date, driven by a convergence of supply disruptions, tariff-induced stockpiling, and structural demand growth from electrification and AI infrastructure.
Mine disruptions continue to tighten the supply outlook. Freeport-McMoRan's Grasberg mine in Indonesia — the world's second-largest copper operation — declared force majeure and now expects 2026 production to be 35% lower than previously estimated. Ivanhoe Mines trimmed output guidance for Kamoa-Kakula in the DRC following flooding. Combined, these and other disruptions have removed an estimated 500,000-600,000 tonnes of contained copper from the supply pipeline.
The concentrate market reflects this squeeze: treatment and refining charges (TC/RCs) are at record lows, forcing smelters in Japan and China to consider capacity cuts. Japanese smelters including Pan Pacific Copper have confirmed plans to reduce capacity, and annual supply negotiations are described as the most complex in memory.
US tariff policy remains the dominant near-term price driver. A 50% tariff on semi-finished copper products effective August 2025 triggered massive pre-tariff stockpiling, pushing COMEX inventories above 400,000 tonnes. The US Commerce Department's June 30, 2026 review of refined copper tariffs could add 10-15% duties. A delay beyond 2026 would be bearish, as focus shifts to the well-supplied global market.
The demand side remains robust. AI data center buildout, grid modernization, and EV production are creating structural demand growth that most analysts expect to continue through the 2030s. J.P. Morgan forecasts a refined copper deficit of approximately 330,000 tonnes in 2026, with an average price near $12,075/t and a Q2 peak around $12,500/t.
LME copper at $13,800/t leaves limited margin for error. With the June 30 tariff review approaching, buyers should secure Q3 volume under existing terms before the decision. Consider splitting exposure: 60% fixed-price contracts, 40% indexed to the monthly LME average to capture any post-decision correction. If tariffs are imposed, US COMEX premiums over LME could widen further, making LME-indexed contracts for non-US delivery more attractive.