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Copper prices continued their remarkable climb on Friday, bolstered by a positive forecast from Citigroup that highlighted potential global supply shortfalls.
Futures on the London Metal Exchange jumped as much as 2.2%, reaching $11,705 a tonne—surpassing the previous record set earlier this week. In recent weeks, industrial metals have been on the rise as traders expect tighter supplies, partly due to stockpiling in the U.S. ahead of potential tariffs.
The surge gained momentum after Citigroup supported this supply-centric view, predicting that increasing U.S. inventories could lead to a global copper deficit, pushing prices to $13,000 per tonne by the second quarter of 2026.
Analysts at Citi, led by Max Layton, expressed their confidence, stating, “We remain optimistic about copper’s upward movement through 2026, driven by various positive factors including strong fundamentals and a supportive macro environment.”
On the demand side, the bank projects a 2.5% rise in global end-use consumption next year, attributing it to low interest rates, U.S. fiscal expansion, European rearmament, and the transition to renewable energy.
shortage of supply
The New York bank joins other copper bulls, such as commodity trader Mercuria, which has reportedly requested the withdrawal of approximately $500 million worth of copper from LME warehouses in anticipation of supply shortages.
Copper stocks at global exchanges have surged to over 656,000 tonnes, the highest level since 2018, with about 60% stored in Comex-managed warehouses in the U.S., according to Bloomberg data.
Earlier this week, BloombergNEF released a report suggesting that the copper market may face a structural deficit next year, with strong demand paired with supply constraints widening the gap over the next decade.
contrasting scenery
Nevertheless, some analysts are adopting a more cautious perspective on copper. Goldman Sachs remarked in a note on Thursday that the high prices around $11,000 are unlikely to last, as global supplies of the metal are “adequate.” They believe that a scarcity is probably not on the horizon until at least 2029.
Similarly, analysts at Macquarie Group, under the direction of Peter Taylor, noted that while the metal remains “volatile” and could hit new highs, prices above $11,000 a tonne are unsustainable, given that global markets aren’t facing significant shortages.
Benchmark Minerals cautioned in a market update this week that genuine end-use demand “is still a concern.” They indicated that recent price increases may reflect optimism about the future more than current realities. “The last time copper reached an all-time high, it faced pressure in the subsequent weeks,” they added.
This year, copper has surged more than 30% in London as flows of the metal to the U.S. rise in anticipation of import tariffs.
