The cost of copper exceeded $12,000 for the first time. The market is expecting the strongest growth since 2009

The cost of copper reached a new all-time high, exceeding $12,000 per ton for the first time. The price is rising amid widespread production stoppages at mines and disruptions in global trade caused by US trade policy. These factors are guiding the key industrial metal to its biggest annual rise since 2009, market participants warned.

Copper at trading on the London Metal Exchange (LME) on December 23 updated the historical maximum, for the first time overcoming the mark of $12,000 per ton, follows from the exchange data. The industrial metal, which is considered an indicator of the state of the global economy, rose in price by more than 2% to $12,159.5 per ton at the moment, according to Bloomberg.

The copper rally has been going on since October: it was triggered by serious incidents at major mines that hit production and heightened fears of a supply shortage, the Financial Times points out. Even before that, analysts expected that in the coming years the market will begin to form a deficit on the background of growing demand. At the end of 2025 copper may show the strongest growth for the year since 2009: since the beginning of January, the price of metal has already increased by 37%.

Also one of the key factors of growth was the possible introduction of U.S. duties on copper in 2026. A surge in imports into the United States has left producers in other countries caught up in a price race to maintain supplies, Bloomberg notes. The impact on global trade flows has been so severe that prices continue to rise despite rapidly deteriorating real demand in China, which consumes about half of the world's copper.

Record copper prices are "supported by expectations of additional stimulation of the Chinese economy," said John Meyer, an analyst at consulting firm SP Angel. According to him, the weakening of the U.S. dollar also contributes to the growth of quotations of both precious and base metals, notes the Financial Times.

In addition, mine shutdowns in the Americas, Africa and Asia have heightened fears that the market is close to a major shortage, which could further drive up prices, analysts at Deutsche Bank explain. They warn that the production of the world's largest producers will decline by 3% this year and could decline even more in 2026, Bloomberg writes. The deficit could come as early as 2026, and it will be the most serious for 20 years, although now the global reserves are still enough, analysts warned Morgan Stanley. According to their calculations, demand will exceed supply by about 600,000 tons, Bloomberg reports.

Supply-side risks have been a key theme in the copper industry for years and underpin optimistic forecasts from banks and investors, along with expected demand growth from the electric vehicle, renewable energy and artificial intelligence industries. Citigroup advises clients to consider a scenario in which the price could reach $15,000 a ton - in the event of a weaker dollar and lower U.S. interest rates, which would make copper more attractive to investors, Bloomberg adds.

Similar bold forecasts sounded at the beginning of the pandemic Covid-19, when copper prices rose sharply, but then the rally eventually stopped below $11,000 per ton due to stiff resistance from buyers in China, recalls Bloomberg. And this time the growth raises doubts in part of the market: analysts at Goldman Sachs note that the current jump in prices is largely due to investment bets on the future deficit, rather than the current balance of supply and demand. Nevertheless, copper remains for the investment bank the main favorite among industrial metals. In mid-December, it raised its price forecast for next year to $11,400 per ton.

This article was AI-translated and verified by a human editor