Copper prices are moving up sharply after production stopped at Indonesia’s Grasberg mine, the world’s second-largest copper producer. This has created worries of a supply crunch in the global market.
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How Copper’s Reddish Glow Is Luring Smart Investors
Investment bank Goldman Sachs has reduced its copper supply forecasts for 2025 and 2026. The bank expects copper prices could rise to $10,200–$10,500 per ton.
Indian brokerage Companies is also bullish on copper. The firm believes the red metal may hit all-time highs, supported by decarbonization, electrification, and digitalization trends worldwide.
Global copper-prices are on the boil after production came to a halt at Grasberg — the world’s second-largest copper mine in Indonesia — stoking fears of a deep supply crunch in a market already struggling to keep up with surging demand.
Production Outlook
According to reports, BMO Capital Markets noted that the preliminary 35% cut to the 2026 production outlook is a negative factor, with Grasberg output not expected to return to pre-incident levels until 2027. This means there will likely be a supply-demand imbalance, prompting copper prices to remain elevated in the coming months.
Copper Mine Supply
Earlier today, Reuters reported that Goldman Sachs has trimmed its global copper mine supply estimates for 2025 and 2026 after the disruption. Production from the mine is now expected to decline by 250,000–260,000 tons in 2025 and by 270,000 tons in 2026. The supply hit has prompted the investment bank to highlight upside risks to its December 2025 copper price forecast of $9,700 a ton, with prices potentially rising to $10,200–$10,500. Goldman Sachs reaffirmed its long-term bullish call, projecting copper to reach $10,750 a ton by 2027, citing deeper mines, lower ore grades, and multiple disruptions this year — including at Kamoa-Kakula and El Teniente — as ongoing challenges.
Copper Outlook Strongly Bullish
The long-term outlook for copper remains strongly bullish, supported by structural shifts in the global economy toward decarbonization, electrification, and digitalisation. As governments worldwide set ambitious climate targets and invest heavily in green technologies, copper demand is expected to rise sharply. Despite price swings, the strong and steady growing demand, particularly in Asia, supports a firm long-term bullish outlook for copper prices reaching an all-time high of $11700 on LME and Rs. 1,080 on MCX from a medium to long-term perspective.
On the demand side, China remains the largest consumer of copper, accounting for roughly 60% of global demand in 2024-25. After weathering property sector shocks, China pivoted towards infrastructure and green energy. A $300 billion grid modernisation initiative and record solar additions have accelerated copper demand for solar and renewable energy grid expansion.
Electric vehicles (EVs) are another major growth engine, each requiring three to four times more copper than conventional cars — roughly 25 to 50 kg per EV versus 8–12 kg in traditional vehicles. Copper demand from EVs is expected to soar from 1.2 million tons in 2025 to 2.2 million tons by 2030, with global EV production projected to exceed 30 million units annually by the end of the decade.
Investor appetite is responding in kind. Copper-focused exchange-traded funds have attracted $2.3 billion in net inflows so far in 2025 — a 45% jump over 2024 — while managed money accounts are holding net long positions of 68,000 contracts, near the highs seen during the 2021 commodity supercycle, Motilal’s report added.
Copper is The New Gold
Copper is the new gold’, underscoring the metal’s growing importance. Pointing to Canada-based Barrick Gold’s decision to drop “Gold” from its name to signal a pivot toward copper mining, Agarwal urged investors and entrepreneurs to treat the metal as a national mission. “A great opportunity for young entrepreneurs and investors. Let’s make it a mission,” he wrote.