Copper price rises on mine struggles, Goldman bull flag
Copper climbed nearly 2% on Thursday as one of the world’s top miners gave a conservative production outlook, adding to the metal’s supply concerns in a year marred by global disruptions.
Prices surged as much as 1.7% to above $10,800 per tonne on the London Metal Exchange, while three-month contracts on the COMEX gained 1.9% to $5.10 per lb., equivalent to $11,250/t.
The metal used in wiring for renewable energy, electronics and construction has rallied more than 20% this year, supported by a series of major global mine outages and production setbacks. Prices have been on the rise since August following major incidents at Chile’s El Teniente, the world’s largest underground mine, and Grasberg in Indonesia within the span of a month.
In a further exacerbation of supply worries, Chile’s Antofagasta, one of the largest copper producers globally, said on Thursday that it expects to hit the low end of its 2025 production target and gave a production forecast for next year that missed analysts’ estimates.
The miner’s “operational update was mixed overall versus our expectations,” analysts at BMO Capital Markets said in an emailed note to Bloomberg. “Maiden 2026 copper production guidance may disappoint slightly.”
Goldman boost
In a further boost to copper prices, Goldman Sachs pointed to a near-term bullish view among traders.
The bank, citing industry players it spoke with during the recent LME Week conference in London, signalled that prices may test all-time highs again over the coming months, as some investors are planning to add to their positions once prices breach $10,900/t.
The view is backed by the huge arbitrage opportunity created by US import tariffs on copper, which drove prices in New York to an all-time high of $5.732 per lb. in July.
US futures on the COMEX exchange are still trading at a premium over London prices that are the global benchmark, and the metal is flowing to America, according to Bloomberg.
“In the near-term, we see the positive COMEX-LME arbitrage as having a material tightening impact on the physical ex-US market and posing temporary upside risk to our LME copper price forecast range of $10,000-$11,000,” Goldman analysts including Eoin Dinsmore wrote in a note.
Zinc squeeze
Meanwhile, zinc buyers are facing a historic squeeze on the LME as exchange inventories dwindle, but Goldman analysts said it expects shipments from China to replenish reserves.
“The global zinc market is currently balanced, but regional differences have emerged with China in surplus and the rest of world in deficit,” they wrote. “In the near term, clients we spoke with agreed with our view that the China export arb will open to rebalance the global market.”
(With files from Bloomberg)
Southern Copper’s $1.8B Tía María mine gets green light
Southern Copper (NYSE, LON: SCCO) has secured a long-awaited licence for its $1.8-billion Tía María copper project in Peru, marking a major step forward after years of social unrest and political delays.
Peru’s Ministry of Energy and Mines (Minem) approved the mining licence last week, clearing the way for the project to enter the exploitation phase.
Located in the Islay province of the Arequipa region, the project is expected to reignite confidence in Peru’s mining sector and potentially unlock other stalled developments across the country.
Tía María faced years of delays due to local opposition over environmental concerns. Protests between 2011 and 2015 left six people dead and forced the project’s suspension.
Although the government approved the mine in 2019, it tied progress to the restoration of social stability. Southern Copper resumed development in 2024 after local tensions eased.
With the licence now in hand, the company can begin pre-mining work and pit stripping. The project is 25% complete, with most progress centred on auxiliary facilities and the treatment plant. The initial construction phase, covering access roads and platforms, was 90% finished as of July.
Tía María is expected to begin production by late 2026 or early 2027, delivering 120,000 tonnes of copper annually over a projected 20-year lifespan. The output would secure Peru’s position as the world’s third-largest copper producer.
$7 billion worth of projects
In 2024, Southern Copper Peru produced 414,000 tonnes of copper, ranking it as the country’s second-largest producer. But the broader mining landscape remains constrained. A recent study found that 31% of Peru’s untapped copper production capacity, equal to around 1.8 million tonnes per year, is effectively “off-market” due to environmental, social, or governance challenges.
The Peruvian Institute of Economics (IPE), an industry-backed think tank, estimates that about $7 billion worth of copper projects are stalled due to illegal mining invasions. Impacted developments include Southern Copper’s Michiquillay and Los Chancas projects, as well as First Quantum’s Haquira copper project. IPE also forecasts illegal gold exports could reach $12 billion in 2025.
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