The demand in new energy vehicles, photovoltaic and wind power, power grid and data centers continues to grow, and the market generally regards this round of energy transition as a "long-term, strong determination" of demand increase. On this basis, the US dollar weakness, the expectation of the US Federal Reserve's interest rate cut in December, and the temporary "shutdown" of overseas exchanges have jointly amplified the slope of the price breakthrough.

Last week, LME and SHFE copper prices rose together, with LME copper reaching a intraday high of $11,210.5 per ton, setting a new historical high, and the main contract of SHFE copper also approached the previous high.

Kostas Bintas, head of the metal business at Mokurei Energy Group, recently re-iterated his bull case for copper prices and issued a warning that global copper stocks are at risk of further depletion as a glut of metal pours into the US market. He described the current situation as a “big opportunity” for copper bulls.

According to reports, Bintas stated that the lucrative arbitrage trade in the United States is making a comeback, which will lead to a shortage of copper supply outside the United States, driving up copper prices. He believes that if one simply looks at the current market trends from a mathematical perspective, the shortage of supply and the rise in prices will be the only answers, and ultimately even Chinese buyers will have to pay a higher premium to ensure supply. If the current capital flow continues, other parts of the world will face the dilemma of "running out of copper".

Wu Zijie, a copper researcher at Jinxue Futures, believes that the core reason for the current rise in copper prices is the decline in supply. On the one hand, the main copper-producing countries such as Chile have not met expectations this year, and the domestic refined copper production has also declined temporarily. The import of intermediate products such as scrap copper and anode copper has been at a low level in recent years, and the smelting processing fee has been at a historical low level for a long time, even approaching zero or negative values at one point, which clearly reflects the supply shortage problem at the copper concentrate end. On the other hand, the overall copper stock in domestic and foreign exchanges has maintained a downward trend, and the copper stock monitored by the Shanghai Futures Exchange is low and still declining recently. From the demand side, the demand in fields such as new energy vehicles, photovoltaic wind power, power grids, and data centers continues to grow, and the market generally regards this round of energy transformation as a "long cycle, strong determination" demand increase. On this basis, the weakening of the US dollar, the warming of the expectation of the Fed's interest rate cut in December, and the brief "shutdown" of overseas exchanges have jointly amplified the slope of the price break to the upside.

Xiao Jing, the person in charge of the Non-Ferrous Metals Group at IFC, believes that the price of LME copper futures reached a historical high last Friday night, which intuitively reflects the enthusiasm of capital for long-position allocation. On the supply side, the growth rate of mainstream copper mine production in 2025 has been continuously revised downward, the resumption of large mines in the first quarter of 2026 is difficult to achieve significant progress, and at the same time, the lower long-term contract processing fee under the mining and smelting game has prompted Chinese and Japanese smelters to reduce mine capacity one after another. From an investment perspective, the market generally believes that copper prices are relatively undervalued, and the technical pattern shows that the LME copper price has broken through the $10,000/ton mark, which means that it has opened up the space for long-term price increase.

From a transaction logic perspective, Wu Zijie believes that the market is using higher forward prices to "balance" the expected supply gap. The price of Shanghai copper is following the foreign market pricing while also being influenced by domestic actual demand, the ratio of import to export, and exchange rates. Since the beginning of the year, the price of Shanghai copper has risen from about 70,000 RMB/ton to nearly 90,000 RMB/ton, but after the price exceeded 90,000 RMB/ton, the volume of spot transactions and the willingness of downstream buyers to take delivery have significantly decreased. Data shows that the output of refined copper in September saw a significant decline year-on-year for the first time, and tax system adjustments and centralized maintenance further squeezed the phased output. The year-on-year decline in the import of anode copper in China exceeded 10%. On the demand side, the decline in real estate and some infrastructure projects has dragged down the terminal consumption of wires and cables, but investment in new energy vehicles, charging piles, wind and solar power stations, and ultra-high voltage power grids has maintained a high growth rate. The recovery of manufacturing, the renewal of infrastructure, and the construction of data centers have continued to drive the growth of overseas copper demand.

Xiao Jing said that the sentiment of medium and long-term bull market in copper futures in Shanghai is strong. On the macro side, the liquidity of global financial markets in November was locally tight, which did not have a negative impact on the price pattern of copper. The domestic spot market's adaptability to high copper prices has significantly improved compared to the second quarter of last year, and most of the time in November, the trading was maintained at a certain premium, and the social stockpiles were basically the same as in October.

Looking ahead to the future market, Wu Zijie said that after a significant rise and the creation of a new historical high, the price of copper in December is likely to experience a wide range of consolidation at a high level. On the one hand, the previous long positions have been profitable, and any macro or emotional disturbances could trigger the demand for profit-taking, causing the futures price to fluctuate around the previous high. On the other hand, factors such as tight supply of refined copper concentrate, low processing fees, and low inventory limit the space for price adjustment. Therefore, December is more like a process where the market re-prices the real demand strength for copper at a high level and the macro monetary environment. The results of the Federal Reserve's interest rate meeting, economic data from the United States and China, and fluctuations in overseas financial markets will directly affect the price of copper. From the disclosed mine production rhythm, smelting expansion and maintenance plans, the global refined copper supply is still mainly in a tight balance before and after 2026, and new projects are difficult to release sufficient incremental capacity in a short period of time. Moreover, structural demand such as energy transition, power grid, and data center investment will not significantly contract due to the rise in prices, which means that the copper price center is expected to continue to stay in the historical high range. "The following three aspects need to be focused on in the future: one is the recovery rhythm of mine production; the second is the domestic demand situation; the third is the global monetary policy and the trend of the US dollar index."

Xiao Jing said that the current stockpiling of copper in Shanghai may continue to rise, and the copper price from abroad may break through the $12,000 per ton mark in the first quarter of 2026.

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