Copper prices have climbed sharply in recent weeks, with three-month contracts on the London Metal Exchange reaching $11,146 per ton—surpassing the previous high set in 2024. Since the beginning of the year, the metal’s price has increased by more than a quarter, driven by a perfect storm of dwindling stockpiles, supply disruptions, and surging demand from the green energy sector.

The tightening supply chain has been exacerbated by a series of mining accidents at major production sites. Most notably, a landslide at the massive Grasberg mine in Indonesia—operated by Freeport McMoRan and the world’s second-largest copper mine after Chile’s Escondida—has significantly impacted output. Last year, Grasberg produced 815,000 tons of copper, representing 4 percent of global production.

Meanwhile, demand continues to climb, particularly from manufacturers of electric vehicles and renewable energy infrastructure, both of which require substantial amounts of copper. The shift toward electrification and clean energy has transformed copper from a traditional industrial metal into a critical component of the global energy transition.

American industrial and tariff policies have further strained the global copper market this year. The United States has introduced incentives for domestic production alongside import tariffs, which has boosted copper demand within the U.S. and diverted supplies from international markets. This has contributed to the mounting pressure on already tight global inventories.

Adding to the uncertainty, Anglo American, one of the world’s largest mining companies, recently warned that copper production from its most important mine would likely fall short of expectations next year. “Copper prices are being supported by increased risk appetite due to optimism about a potential trade deal between the U.S. and China,” said Craig Lang, chief analyst at CRU Group, highlighting how geopolitical factors are also influencing market sentiment.