Record-High Copper Prices on the LME Driven by U.S. Tariff Uncertainty and Supply Strains

On September 7 2026, three-month copper futures on the London Metal Exchange surged 0.8 % intraday to $14,533 per metric ton, eclipsing the January record of $14,527.50. The next day the contract touched $14,617 per metric ton before easing. The rally coincided with a muted U.S. market (Labor Day holiday) and a pronounced backwardation—spot prices above near-term futures—signalling tight near-term supply.

Bloomberg

Long-term demand remains robust, driven by AI data-center expansion, renewable-energy projects, EV production and defense equipment. Supply is lagging. Global mined output fell 1.1 % in the first half of 2026 (ICSG). Chile reported a 78 % month-over-month rise in July imports of refined copper to the United States (225,094 t)—the highest single-month total since 1990—while its August export revenue slipped to $4.63 billion, the lowest in more than a year. Declining ore grades, aging fleets and weather-related disruptions have further eroded output in Chile, the DRC and Indonesia.

Copper Hits Record High as U.S. Tariff Fears Drain Global Supply

The short-term squeeze stems from a geographic reallocation of copper. COMEX inventories in New York have swelled eight-fold since February 2025, reaching roughly 695,000 t (? 764,600 short tons). LME-linked warehouses have seen stockpiles plunge to “crisis-level” lows, prompting a sharp short squeeze in August.

Copper Hits Record High Amid Tight Supply, Tariff Fears

The catalyst is the expectation that the Trump administration will expand tariffs on refined copper imports. President Donald Trump first formally proposed such levies in February 2025; the U.S. Department of Commerce was required to submit a report by June 30 2026, but no decision has been released. Traders have responded by front-loading shipments to U.S. warehouses, draining material from the global LME network.

Bloomberg

• Analysts at Bloomberg and TradingView note that unless Chile’s production rebounds in the second half of 2026, global mine supply could record its first annual decline since 2017.

Copper Hits Record High as U.S. Tariff Fears Drain Global Supply

• “This is driven more by the relocation of metal due to tariffs than by excess final demand,” — Cristián Cifuentes, senior analyst, Cesco

Bloomberg

Sources differ on the exact size of COMEX inventories after the surge: SBS cites ?695,000 t, while Bitget reports ?764,600 short tons (? 693,630 t). Both agree U.S. inventories have risen dramatically, but the precise figure remains unsettled. Most outlets agree Chile’s export revenue fell to $4.63 billion in August, though the percentage decline varies.

Copper Hits Record High as U.S. Tariff Fears Drain Global Supply

The U.S. Commerce Department’s pending tariff report, originally due June 30 2026, remains unpublished. Market participants will watch for any formal announcement, which could either cement the current inventory-driven price environment or relieve pressure if tariffs are not imposed. Miners’ ability to restore output in Chile and elsewhere will be a key determinant of whether the backwardation persists.

Copper Moves Toward Record High