Copper prices have surged to two-year highs, buoyed by concerns over supply shortages and a positive outlook for demand. Rising expectations of supply tightness and optimism about demand driven by energy transition applications have contributed to this upward momentum. The closure of First Quantum’s Cobre mine in Panama has further exacerbated supply constraints, while a recovery in manufacturing activity, particularly in China, has boosted demand. Analysts believe that the long-term energy transition trend, coupled with underinvestment in new mine supply, will sustain copper prices despite potential price corrections in the short term. Copper is increasingly becoming a crucial commodity for industries such as electric vehicles, artificial intelligence, and automation. Interest rate cuts in major economies have also added to the positive growth prospects for copper. As supply constraints become more evident through draws on LME and Shanghai Futures Exchange warehouses, the true test for copper prices will be their ability to remain elevated or even rise further.
Copper Prices Surge to Two-Year High, Driven by Supply Shortages and Positive Demand Outlook
