Copper Prices Surge to Unprecedented $13,000 as Supply Strains Deepen

Key Moments

Record High on Supply Fears and Robust Demand

Copper futures pushed to an all-time high of $13,000 a ton, extending a powerful rally that began last year. Prices advanced as much as 4.3% on the London Metal Exchange, driven by a combination of mine disruptions and logistical bottlenecks that are intensifying worries about availability of the key industrial metal.

A strike at the Mantoverde operation in Chile marked the latest in a series of setbacks on the supply side, arriving at a time when global demand is increasing. The metal is widely used across sectors such as data centers and car batteries, cementing its role as a critical input for industrial activity and technology infrastructure.

BREAKING: Copper prices extend gains to hit a new record high, now up +4.5% on the day. pic.twitter.com/forBdtuZQj

— The Kobeissi Letter (@KobeissiLetter) January 5, 2026

Tariffs Distort Trade Flows and Inventory Distribution

Concerns around potential US import tariffs on copper have prompted traders to accelerate deliveries to the American market in recent weeks. This front-loading of shipments has helped bolster copper availability in the US but has also tightened supplies in other regions.

UBS Group AG analysts, including Daniel Major, wrote in a note that “We estimate the global refined copper market was in surplus in 2025, but metal/inventory flows were distorted by US tariffs that resulted in a material lift in US imports.” According to their assessment, the US now holds around half of global copper inventories, even though it accounts for less than 10% of worldwide demand.

This imbalance raises the prospect of constrained supply outside the US. The cash-to-three month spread in London remains in firm backwardation, a structure that typically signals stress in short-term availability.

Rally Fueled by Disruptions and Energy-Transition Demand

Copper, described as vital for the energy transition, climbed 42% in 2025, marking its strongest yearly performance since 2009. That rally was supported by a series of severe supply disturbances, including a deadly incident at the world’s second-largest copper mine in Indonesia and an underground flood in the Democratic Republic of Congo. These events contributed to repeated price records over the period.

President Donald Trump’s plan to revisit the issue of tariffs on primary copper in 2026 has also revived an arbitrage trade that had previously unsettled the market earlier last year, adding another layer of complexity to pricing and flows.

Analysts Flag Emerging Deficits

Market strategists are increasingly focused on the risk of a tightening global balance. “Overall supply shortfalls, coupled with regional dislocation caused by US tariffs, are propelling copper,” analysts at China Securities Co., led by Wang Jiechao, wrote in a note. They added that “The global copper market will see a shortage of more than 100,000 tons in 2026.”

Current Price Snapshot

In London afternoon trading, three-month copper remained sharply higher, underscoring the strength of the move.

The combination of structural demand from the energy transition, recurring supply disruptions, and ongoing tariff uncertainty continues to set the tone for copper trading, with investors closely watching how inventory dislocations and policy decisions will shape market dynamics into 2026.