Copper struck a fresh 15-month high on Thursday, extending recent gains as proposed controls on smelting capacity in China exacerbated fears over supply after Freeport-McMoran Inc FCX slashed its mine production forecast in Indonesia.

Benchmark three-month copper HG1! on the London Metal Exchange rose 0.9% to $10,431.50 a metric ton by 0939 GMT.

It touched $10,485 earlier in the session, the highest since May 2024, when the metal used in power and construction hit a record high of $11,104.50 a ton.

In China, home to over half the world’s copper smelting capacity, the China Nonferrous Metals Industry Association said it had proposed specific measures to control copper smelter expansion as persistently low processing fees have reduced smelter profits.

This development came as traders were still grappling with Wednesday’s price surge after Freeport declared force majeure at its Grasberg mine in Indonesia, where it now sees output in 2026 being 35% lower than previously estimated.

“The Grasberg news adds to disruption to an already tight market,” ING analyst Ewa Manthey said by email. “Grasberg is the world’s second largest copper mine, so this disruption is significant for the global market, likely moving it into a deficit next year.”

“Looking ahead, copper prices are likely to remain supported by ongoing supply disruptions, tight concentrate availability, and tight ex US inventories,” Manthey added.

The discount for the LME’s cash copper contract against the three-month forward (MCU0-3) has drastically narrowed to $10 a ton on Thursday, from $73 a ton on Tuesday, indicating tighter immediate availability.
Goldman Sachs on Thursday lowered its global copper mine supply forecast for 2025 and 2026, estimating a total loss of 525,000 tons of copper mine supply due to the disruption.

Among other metals, aluminium ALI1! rose 0.6% to $2,666.50 a ton, zinc ZNC1! added 0.3% to $2,946.50, lead LEAD1! climbed 0.5% to $2,008.50, tin FTIN1! gained 0.6% to $34,470 and nickel NICKEL1! was up 0.4% at $15,485.
Source: Reuters