Copper: Booming prices face supply risks – Commerzbank

Commerzbank’s Barbara Lambrecht highlights that Copper prices on the LME are close to record highs, with an unusually large cash–3‑month spread driven by falling LME stocks and tariff-related pre‑emptive buying in the US. She notes supply concerns from weak smelter margins, potential production cuts in China and the Democratic Republic of the Congo, while longer-term demand growth and lagging mine development point to a future Copper supply shortfall.

Tight stocks and structural deficits

"Even though the deadline for the report has passed, the surge in imports is likely to continue, at least in the short term."

"Risks therefore exist on both the supply and demand sides: Demand in the US could slow if customs duties on refined copper were postponed, giving US market participants a further respite."

"On the other hand, supply could disappoint if production growth in the two major growth markets of recent years were to slow significantly."

"Nevertheless, we warn of a medium- to long-term supply shortfall in the market: demand for copper is being driven by technological and energy policy shifts in the global economy."

"Under current conditions, the IEA forecasts a supply shortfall of 25 per cent by 2035."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)