Copper hit a record high on June 2 and is now pushing even higher. Storms disrupting Chile's mines are the latest catalyst, but several longer-term tailwinds continue to support the metal.
Supply was already breaking before the storms
Chile produces more than a fifth of the world's copper. State-owned Codelco, the world's largest copper miner, recently ruled out any chance of hitting its previous production target of 1.7M tonnes within five years.
Its new chairman said there's "no possibility" of reaching that goal, and the company guided 2026 output at no more than 1.357M tonnes. Chile's national copper output was revised down 2% for the year to 5.3M tonnes, marking a second consecutive year of declining production.
Then the storms hit. Anglo American, Antofagasta, Lundin Mining and state-owned Codelco all saw operations disrupted by heavy snow, flash flooding, and high winds. Lundin said its Caserones mine could take two to three weeks to restart after power lines were damaged by snowfall.
Analysts described the direct storm impact as temporary and limited, particularly for larger miners with contingency plans. Smaller operators with less flexibility are more exposed.
Chinese demand is tightening the screws
The supply crunch isn't just a Chile problem. Chinese smelters are running short of raw materials, specifically scrap copper and concentrates, after Beijing cracked down on domestic scrap availability through a tax shake-up.
China's import premiums spiked to $115 per tonne recently, the highest level since 2022. Traders expecting China to buy more copper to offset its domestic shortage have already started pulling metal from LME warehouses. LME inventories have dropped roughly 40% since mid-April.
The LME backwardation, where nearby contracts trade at a premium to three-month futures, recently hit its widest point since January. That's a technical signal that buyers are competing for metal right now, not later.
The US tariff wildcard hasn't been played yet
Nearly 64% of visible global copper inventories are now sitting in the US. That concentration reflects tariff anxiety, not genuine demand.
Traders have been stockpiling in US warehouses ahead of potential Section 232 import tariffs, which were initially expected by the end of June but haven't materialized. Comex warehouses hold roughly triple the copper they held a year ago.
The uncertainty cuts both ways. If tariffs arrive, US copper prices could diverge sharply from the global benchmark. If they don't, that stockpiled metal could flow back into global markets and ease prices.
The US premium over the LME benchmark currently sits at roughly $470 per tonne. Strategists at StoneX say the tariff outcome "remains the largest unknown in the market."
Miners are already cashing in
With copper near record levels, the financial results from major miners are striking. Anglo American reported a 35% jump in first-half earnings to $4B.
Profits from its South American copper mines surged two-thirds to $2.9B. Copper now contributes roughly 70% of Anglo's total earnings.
"We are a copper-led mining company... underpinned by some of the world's best mining assets."
Duncan Wanblad, Anglo American CEO
Glencore reported a 15% increase in first-half copper production. Freeport-McMoRan and Southern Copper each gained more than 3% in a single session as earnings highlighted the strength of copper margins. Comex copper is up roughly 14% so far in 2026.
For retail investors, copper exposure comes through miners, commodity ETFs, or potentially a new route. Kalshi is considering perpetual copper futures, a type of derivative with no expiration date, to let investors bet on copper prices around the clock. The firm hasn't filed for regulatory approval yet.
Whether another record price follows depends heavily on what Washington decides to do next.
