Copper Hits Record Highs as Supply Tightens

Key Takeaways:

• Record copper prices: Comex copper futures hit $14,781 per ton on Aug. 5, surpassing the previous high set in May, while LME copper closes in on its January peak of $14,527.50 per ton.
• Tariff-driven US copper hoarding: More than 200,000 tons entered US ports in July 2026, the largest monthly inflow on record, pushing Comex inventories up more than 40% year-to-date as traders front-run potential refined copper duties.
• SX-EW copper supply disruption: The Strait of Hormuz closure and China’s sulfuric acid export ban have stripped roughly a quarter of total acid supplies, cutting into the leaching process that produces more than 15% of world copper output.

Copper for September delivery touched $6.7045 per pound, or $14,781 per ton, on the Comex on Aug. 5, setting a new all-time high in New York. London moved in the same direction, with the London Metal Exchange copper price topping $14,000 per ton for the first time in two months and pressing toward January’s record of $14,527.50. The New York-London spread widened to $640 per ton, well above the $350-per-tonne average seen through July.

Two forces are driving the price increase simultaneously: traders racing to beat a tariff decision that’s now more than a month overdue, and a physical supply picture that’s deteriorating independent of any policy move.

Why Are Copper Prices at Record Highs Right Now?

The short answer is that policy and geology have aligned against buyers at the same time.

On the policy side, Washington’s Commerce Department missed its June 30 deadline to recommend whether refined copper imports should face phased duties, starting at 15% in January 2027 and rising to 30% the following year. Traders aren’t waiting for a decision. More than 200,000 tons arrived at US ports in July, the largest monthly inflow since IHS Markit began tracking records in 2014. Comex inventories are now up more than 40% this year. The total US hoard, including private storage, is estimated above one million tons.

What Is the Sulfuric Acid Shortage Doing to Copper Output?

This is where the story shifts from policy uncertainty to hard physical constraint.

Over 15% of global copper output is produced via solvent extraction and electrowinning, a process that requires sulfuric acid to leach ore into finished cathode at the mine site. Two events have gutted acid availability at the same time. The effective closure of the Strait of Hormuz in February cut off roughly half of seaborne sulfur shipments from Gulf producers and Iran, which together supply a quarter of the world’s sulfur. China then banned sulfuric acid exports from May through December, removing close to another quarter of ex-China supply.

The result: global SX-EW output is down by roughly a quarter. The Democratic Republic of Congo, which produces about 1.5 million tons of SX-EW copper annually, and Chile, with roughly 1.2 million tons, are the most exposed. Some operations report acid inventories of just 30 to 60 days, with warnings of production cuts growing.

Chile’s problems go beyond acid. Codelco this week paused the Andes Norte expansion at El Teniente, the world’s largest underground copper mine, after studies identified what the company described as “an emerging seismic phenomenon with characteristics different from the risks that have historically been known and managed in the operation.” Chairman Bernardo Fontaine said there is “no possibility” of reaching Codelco’s 1.7-million-ton annual production target within four to five years.

What Should Buyers and Investors Do Now?

For manufacturers, builders, and industrial buyers, the practical steps are straightforward. Review procurement timelines. Tighten supplier relationships and ask directly about inventory positions and regional premiums. Stagger purchases where possible to spread cost risk. Larger buyers should look at medium-term contracts to smooth volatility. Working-capital implications are real when premiums move this fast.

For investors, copper equities have tracked the increase. Glencore reported an 86% jump in adjusted EBITDA to $10.1 billion in first-half results, with a 15% rise in copper output causing strong trading profits. Freeport-McMoRan, Antofagasta, BHP, and Rio Tinto all moved higher as the sector rerates toward copper exposure and away from iron ore. Copper is up more than 50% over the past year. BMI forecasts structural deficits could take prices toward $17,000 per ton by the mid-2030s.

What Comes Next for Copper Prices?

A potential Strait of Hormuz reopening has lifted broader risk sentiment, with the US, Iran, and Oman reportedly preparing a 60-day shipping arrangement. If sulfur flows resume and China’s acid ban lifts on schedule in December, some SX-EW capacity could return. But Codelco’s El Teniente setback and Freeport’s Grasberg, still recovering from a September 2025 mudflow with full restart not expected before 2028, mean mine-level supply stays constrained well beyond any acid market normalization.

The International Copper Study Group forecasts a 150,000-tonne deficit for 2026, the market’s first structural shortage since 2009. The International Energy Agency projects primary copper supply falling about 25% short of requirements by 2035. Those numbers suggest the tariff arbitrage may be the loudest noise right now, but it’s sitting on top of a fundamentally undersupplied market.

Watch the tariff announcement, the Hormuz negotiations, and Codelco’s next operational update. All three will shape where copper trades through the rest of the year.