Tariff expectations and mine shutdowns “resonate,” LME copper surpasses $12,000 for the first time, setting a new historical high.

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Driven by the dual factors of expected supply disruptions and the threat of tariffs, copper—the industrial metal regarded as a global economic barometer—has reached a new historic high.

On Tuesday (December 23), due to the suspension of operations in mines across the globe and the potential impact of the Trump administration’s tariff policies, the price of London copper broke through the $12,000 per ton mark for the first time in history. Since the beginning of this year, copper prices have risen by about 37% and are poised to record the largest annual gain since 2009.

(LME Copper Futures 1H Chart)

Market expectations for possible tariffs on metals by Trump have become a core factor driving prices higher. To get ahead before the potential tariffs come into effect, traders are shipping large amounts of copper to the United States, causing a surge in U.S. imports and forcing manufacturers in other regions into a fierce bidding war to maintain their inventories.

Meanwhile, the supply side is also facing severe challenges, with mine shutdowns reported in the Americas, Africa, and Asia. The market warns that there will be a major supply gap, further fueling the current rally. As copper prices continue to climb, Citi predicts that in a bull market scenario, prices could rise to $15,000.

Tariff Threat Sparks Global Competition

The impact of Trump’s tariff agenda has already caused severe trade distortions in the copper market.

As traders rush to ship more copper to the U.S. before potential tariffs take effect, the market generally expects prices to keep rising. This “front-running” behavior has caused a sharp increase in U.S. imports throughout the year, disrupting the previous market equilibrium.

The drastic change in trade flows is so significant that copper prices have been able to rebound even when fundamental factors do not fully support it. To safeguard supplies, manufacturers outside the U.S. are forced to participate in bidding wars, driving up global benchmark prices.

Mining Output Faces Shrinking Risk

While the trade side is in turmoil, the supply side has also sounded serious warning signals. With major mines in multiple key producing regions around the world experiencing operational interruptions, the market is on the verge of a supply deficit.

According to analysis by Deutsche Bank, the output of the world’s largest miners will fall by 3% this year and may decline again in 2026. Analysts at the bank reported:

“2025 will be a year of serious disruption, with several large mines facing major operational challenges,” adding that “overall, we believe the market is clearly in a supply shortage.”

For years, supply risks have loomed over the copper industry, and, together with the expected surge in demand from fast-growing sectors such as electric vehicles, renewable energy, and artificial intelligence, have become the main basis for bullish forecasts from investment banks and investors.

It is worth noting that Wall Street is split on the outlook for copper prices.

Goldman Sachs analysts warned in mid-November that the price surge is mainly driven by investors betting on future market tightness rather than current fundamentals. However, the bank still lists copper as its top pick among industrial metals and has raised its price forecast for next year to $11,400 per ton.

By comparison, Citi gave an even more aggressive forecast, suggesting that in a bull market scenario—where a weaker dollar and U.S. interest rate cuts further increase copper’s appeal and drive investors to pour into the market—copper prices could climb to $15,000.

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