With the world's second-largest copper mine suspending production recently due to an accident, the pressure on the international copper mine supply has further increased. At the same time, in response to the issue of "endogenous competition" in the copper smelting industry, which has led to the continuous low level of copper concentrate processing fees, the relevant domestic associations have recently issued a clear signal of opposition to "endogenous competition". Stimulated by the above factors, on September 25, the Shanghai copper futures market saw a net inflow of 7.7 billion RMB of capital, and the market trading volume was significantly expanded; index fund products with a high "copper" content also saw a large inflow of capital.

On the evening of September 24th, Freeport-McMoRan, the US mining giant, announced the suspension of its copper mine in Indonesia due to a mudflow accident. The company's preliminary assessment shows that the sales guidance for copper and gold in the third quarter has been reduced by 4% and 6%, respectively, compared to the expectations in July 2025. At the same time, the company expects that the copper and gold production in 2026 may decrease by about 35% compared to the previous estimate. Moreover, the above-mentioned copper mine in Indonesia may not resume production at the pre-accident level until 2027.

This is a further blow to the already tight global copper market. Analysts at Goldman Sachs have described the event as a "black swan", predicting a loss of 500,000 tons of copper supply over the next 12 to 15 months and asserting that "copper prices must rise as a result".

On September 25th, the closing price of the main contract of Shanghai copper, 2511, was 82,710 RMB/ton, up 3.40%. LME copper also rose further after a 3% increase overnight, approaching 10,500 RMB/ton. On the same day, the Non-ferrous metal sector of the A-share market opened with a large increase, and both Beijing Copper Industry and Luoyang Molybdenum once reached the limit up, and the ETF fund (516650) with a high "copper" content had a maximum increase of nearly 3%. In the past 9 trading days, the fund has increased by 462 million shares, and nearly 1 billion RMB of funds have entered the market, indicating that more and more investors are optimistic about the future of the non-ferrous metal industry.

"Indonesia's copper mine production guidance adjustment will make the supply and demand situation of copper concentrate more severe," said Wang Weiwei, a non-ferrous metal analyst at Yide Futures, believing that the fourth quarter of this year and the copper production in 2026 will be limited by the lack of raw materials at the mine end, and the production will be forced to slow down, making the supply and demand situation more severe.

CITIC Securities analyst Bai Junfei believes that future global mine production growth will significantly contract, predicting that the increase in production from major copper companies in the world from 2024 to 2027 will be about 500,000 tons, which is only about 1/3 of the increase from 2021 to 2024, and the increase will further concentrate on Chinese-funded enterprises.

In addition, the Copper Division of the China Non-Ferrous Metals Industry Association recently issued a clear signal of opposition to the "involutional" competition in the copper smelting industry, which has led to the continuous low level of copper concentrate processing fees. This has added more heat to the copper market. According to SMM data, China's import weekly copper concentrate processing fee is about negative 40 US dollars/ton at present.

Liu Yichen, the chief analyst of Tianfeng Securities in the metal sector, believes that through "anti-internal competition", the match between mining and smelting capacity is improved, making the profitability of enterprises with advantages in smelting costs stronger.

Copper, a key metal used in electronics, has been designated a "strategic resource" by the United States. The rise of the artificial intelligence industry is driving a surge in copper demand, as the metal is being increasingly invested in data center server clusters that require enormous amounts of electricity. According to data from the research firm BloombergNEF, global data centers will consume more than 43 million tons of copper over the next decade, which is roughly equivalent to the annual output of Chile, the world's largest copper supplier.

In the international market, the net long position of hedge funds in the New York COMEX copper futures has increased significantly for six consecutive weeks. According to the latest data from the Commodity Futures Trading Commission (CFTC), as of September 16th, the net long position in the COMEX copper futures contract has increased from 18,032 contracts on August 5th to 426,12 contracts.

As an integrated internet platform providing benchmark prices; On September 26th, the benchmark price of copper by SunSirs was 82,435.00 RMB per ton, an increase of 3.82% compared with the beginning of this month (79,401.67 RMB per ton).

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