Copper Extends Record-Breaking Run as Citi Joins Bullish Chorus
(Bloomberg) -- Copper in London settled near a new all-time high, propelled by a bullish price outlook from Citigroup Inc. as traders anticipate a shortage caused by stockpiling in the US.
The industrial metal closed 1.5% higher at $11,620.50 a ton on the London Metal Exchange on Friday after earlier setting a fresh record of $11,705 a ton that topped the previous all-time high earlier in the week. The moves came as Citi analysts outlined a base scenario that sees copper averaging $13,000 a ton in the second quarter as inventories build up in the US.
“We have conviction in copper upside through 2026 supported by multiple bullish catalysts, including an incrementally constructive fundamental and macro backdrop,” the Citi analysts, including Max Layton, said in a Friday note. They forecast a 2.5% rise in global end-use consumption next year, citing a lower interest-rate environment and fiscal expansion in the US as drivers of growth, as well as European rearmament and the energy transition.
Copper, a key component in pipes, power cables and electric vehicles, has gained more than 30% on the LME this year. The rally has accelerated in recent weeks as concerns grow of an exodus of metal to the US in anticipation of import tariffs next year — in turn, draining inventories in other key locations.
The copper market is set to enter a structural deficit next year, with the shortfall widening over the next decade on robust demand and constrained supply, BloombergNEF said in a report Thursday.
Other analysts, however, have issued more conservative outlooks for copper in recent days. While the metal is expected to remain “volatile” and could easily reach new highs, prices above $11,000 a ton are not sustainable as the global market is not physically tight, Macquarie Group analysts led by Peter Taylor said in Thursday note.
Copper inventories at global exchanges have spiked to more than 656,000 tons, the highest since 2018, with around 60% held in warehouses under Comex in the US. Macquarie’s view echoed caution from Goldman Sachs Group Inc. earlier this week, which doesn’t expect a copper shortage until 2029.
©2025 Bloomberg L.P.
