Copper’s Tight Squeeze: Why Prices Are Rising — And What’s Really Driving It

Copper was trading around $5.08–$5.10 per pound on COMEX and about $10,700 a tonne in London on Monday morning. Those are the highest levels in months, and the reason is simple: a sudden hit to mine supply met a market running on thinner-than-usual liquidity.

The immediate trigger was a disruption at Indonesia’s Grasberg, one of the world’s biggest copper mines. Banks and traders quickly marked down expected output for 2025–26, turning what looked like a balanced market into one that could run short.

Prices jumped last week, dipped as some investors took profits, then climbed again into Friday and held firm overnight. The story behind the story is how the move got amplified.

China, the largest buyer, is on holiday this week, so a key source of selling and arbitrage is missing. With fewer counterparties taking the other side, even moderate buying has a bigger impact on price.

Inventories have not offered much comfort either: LME warehouse stocks have edged lower into October, while China’s Yangshan import premium sat near $50 a tonne before the break—soft short-term buying, but no sign of surplus metal.

In the U.S., futures volumes and open interest rose late last week, suggesting fresh money is leaning long rather than merely covering shorts.

For readers outside Brazil, why it matters is straightforward. Latin American miners—from Chile to Peru and Brazil’s downstream producers—live and die by copper’s cycle.

Higher prices help balance sheets and tax receipts, but they also raise costs for manufacturers in power grids, autos, and appliances.

Technically, the market is strong but hot. On four-hour charts, prices hug the upper Bollinger band with momentum readings in the high-60s; near-term supports sit around $5.05 and $5.00.

On the daily view, copper has broken above all key moving averages; the next resistance is roughly $5.12–$5.20, with first guardrails down at $4.93–$4.98. That points to an uptrend with room for a pause.

What could swing the tape next: clarity on Grasberg’s timeline, daily LME stock changes, and how aggressively Chinese traders re-enter when markets there reopen.

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