Copper price nears record on trade deal boost, supply woes

Group 1 - Copper prices surged toward a record, with prices on the London Metal Exchange rising as much as 1.2% to $11,094 per tonne, just $10 shy of the record reached in May 2024 [1] - Copper futures on the COMEX traded as high as $5.247 per lb., equivalent to about $11,568 per tonne, nearing the record of $12,330 per tonne hit in July [1][2] - The rally in copper prices is driven by optimism over a potential US-China trade deal, which could boost consumption amid heightened supply concerns [2] Group 2 - Copper has rallied by over 25% this year despite a selloff due to US trade policies, with disruptions at major mines raising the risk of a supply deficit [3] - Significant incidents at the Kamoa-Kakula complex in Congo, the largest underground mine in Chile, and the Grasberg mine in Indonesia have contributed to supply concerns [3] - The International Copper Study Group has revised its 2025 mine supply forecasts down to 1.4% growth from a previous forecast of 2.3%, with actual growth of 2.8% expected in 2024 [4] Group 3 - The constraints in copper supply have raised doubts about producers' ability to meet the increasing demand for copper in applications such as wires, batteries, and pipes, especially during the global energy transition [4] - BHP Group, the world's largest miner, anticipates global copper demand to increase by around 70% by 2050 [4] - The decline of the dollar this year has further boosted metals, making commodities priced in US currency more attractive [5]