Copper pushed above $14,300 per tonne on the London Metal Exchange in early August, a fresh all-time high driven by tightening supply and surging demand from AI infrastructure buildout.
LME stockpiles have dropped for 42 consecutive days, the longest run since 2014. Nearly half the remaining inventory has already been earmarked for withdrawal.
That squeeze is showing up in the futures curve. The August-to-September spread jumped to a premium as high as $370 per tonne, the widest one-month gap since a historic supply crunch in 2021. The LME introduced emergency measures to contain the rally.
Tariffs are the wildcard
Traders and producers have been racing to ship copper to the US ahead of potential new tariffs. US copper imports hit their highest level in 12 years in July, topping 200K metric tonnes.
The Commerce Department has recommended a phased tariff of 15% on refined copper starting Jan. 1, 2027, rising to 30% by Jan. 1, 2028.
Societe Generale modeled the COMEX-LME price spread to estimate tariff odds. The current premium implies a 14.6% chance of a 15% duty by January 2027, rising to a 37% probability of a 30% tariff by January 2028.
Natalie Scott-Gray of StoneX called the pending Section 232 decision the "single biggest catalyst" facing the copper market. Comprehensive tariffs would squeeze supply outside the US. No tariffs would unwind the arbitrage trade that has been pulling metal westward.
On the demand side, analysts don't see relief coming. Sprott Asset Management notes an average timeline of 17.5 years from copper discovery to first production, a structural lag that leaves miners unable to respond quickly to demand surges.
Startups filling the processing gap
One layer of the problem is refining. The US has copper resources but sends most of its ore to smelters overseas, much of it in China.
"The U.S. is copper rich and refining poor."
Victoria Beasley, Gigascale Capital
A cluster of startups is trying to change that. Red Metals, backed by Tesla co-founder JB Straubel's Future Ventures, is outfitting a 42K-square-foot facility with processing and casting equipment and recently secured a $3.5M equipment financing facility.
Still Bright has built pilot-scale reactors in Newark, New Jersey, using electrochemical processing, and is weighing a $40M Series A round in early 2027. The VC arm of BHP has backed processing startups Jetti, Ceibo, and PH7 Technologies.
Beasley described the sector as underinvested not just from a venture standpoint but from a total US infrastructure standpoint. With copper futures already up nearly 14% in 2026, that gap is becoming harder to ignore.
