According to Sina Finance, global copper prices have recently been running a persistent “fever.” Copper futures on the London Metal Exchange (LME) have broken through the $10,000 per tonne threshold, hitting a 13-month high. Year-to-date, LME copper futures have surged nearly 20%.
All this stems from a sudden mining disaster.
Indonesia's Grasberg, the world's second-largest copper mine, experienced a massive wet ore spill in September that blocked access routes, forcing production shutdowns. Operator Freeport-McMoRan declared “force majeure,” projecting over 400,000 metric tons in production cuts over the next two years, with full recovery not expected until 2027.
Copper mines in Chile and the Democratic Republic of Congo (DRC) have also seen reduced output due to earthquakes and other factors, further straining the global copper supply chain.
Why could a single mining accident ignite the global copper market? Because copper supply was already tight.
Over the past decade, declining ore grades worldwide have already increased mining difficulty and costs. Compounded by frequent copper mine accidents this year, major banks have raised their copper price forecasts, while Goldman Sachs has lowered global copper production expectations. The global copper market is projected to shift from “surplus” to “shortage,” entering a state of supply tightness. Global copper mine output is now projected to grow by a mere 0.2% year-on-year, far below the previously estimated 0.8%. Meanwhile, demand continues to surge driven by AI, new energy vehicles, and grid infrastructure development. Each electric vehicle requires three times more copper than a gasoline-powered car, while data centers, charging stations, and solar panels all rely heavily on copper. This has cemented copper's status as the “new oil of the new energy era.”
For Indonesia, this incident also exposed a deeper problem: abundant ore reserves but inadequate smelting capacity. While the Indonesian government requires copper concentrate exports to be paired with supporting smelters, reality has seen frequent delays in smelter construction and recurring accidents. The first half of the year saw “ore available but smelting lagging behind,” while the second half turned into “smelting started but ore supply halted.” Situated along the Pacific Ring of Fire and prone to technical bottlenecks, Indonesia faces significant risks from mining to smelting and processing. This has trapped its copper industry in the awkward predicament of “having ore but struggling to smelt it.”
The sharp decline in copper output may provide price support, while copper is poised to benefit from robust demand in this “era dividend.” Amid supply disruptions, soaring demand, and potential Federal Reserve rate cuts, copper prices are expected to remain elevated.
China, the world's largest copper consumer, maintains robust demand driven by grid investments and low-carbon transition initiatives. While China's surging demand in the first half propped up average prices, other global markets slowed due to economic uncertainty, trade tensions, and geopolitical risks.
As an integrated internet platform providing benchmark prices, on October 31, the benchmark price of copper on SunSirs was 88,015.00 RMB/ton, an increase of 5.86% compared with the beginning of October (83,143.33 RMB/ton).
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