Copper prices reach new highs as global supply squeeze deepens and inventory levels drop

On the Comex, prices topped $6.70 a pound in August, marking a fresh all-time high. This price surge is driven by a thinning physical market and a steady drain on inventory. LME warehouse stocks fell for 42 straight days through mid-August, the longest stretch since 2014. A significant supply squeeze was set in motion by a disaster at Freeport-McMoRan's Grasberg mine in Indonesia, where roughly 800,000 tons of wet material flooded the site. This event forced a force majeure and led to Freeport-McMoRan to cut 2026 output guidance at the complex by roughly a third. Global mine output fell 1.1% in the first half of the year, with Chile and Codelco posting double-digit declines. While refined output is expected to inch up, mine supply remains a concern. Citigroup expects copper to reach $15,000 a ton by year end, with potential to reach $17,000 if demand outpaces supply.