Benchmark: Surging Copper Prices Highlight Looming Global Supply Challenges
Copper prices surged through 2025 and into 2026, placing the red metal firmly back into the spotlight as concerns about a looming global supply shortfall mount among market watchers.
Analysts say the tightening outlook reflects a powerful mix of rising demand — driven by urbanization, the energy transition and the rapid expansion of artificial intelligence infrastructure — against a backdrop of stagnant mine supply.
Speaking at the Benchmark Summit, held in Toronto on March 2, Carlos Piñeiro Cruz, principal copper analyst at Benchmark Mineral Intelligence, outlined the key forces shaping the copper market in the near term, while warning that structural supply challenges could intensify over the coming decade.
Copper supply side increasingly tight
It’s no secret that the current copper supply and demand situation is untenable.
In 2025, mining disruptions led to significant declines in output. Cruz noted that production in Q4 2024 exceeded that of any quarter in 2025; in fact, the sector lost around 1 million metric tons (MT) of output in total.
Much of the reduction was due to unforeseen situations, such as the mudslide at Freeport-McMoRan’s (NYSE:FCX) Grasberg in Indonesia, seismic events at Ivanhoe Mines’ (TSX:IVN,OTCQX:IVPAF) Kamoa-Kakula in the Democratic Republic of Congo and worker strikes at BHP’s (ASX:BHP,NYSE:BHP,LSE:BHP) Escondida in Chile.
While the operations will eventually recover, the incidents came at a time when the copper market is increasingly tight and is expected to enter into a supply deficit in the coming years.
Cruz is predicting copper production growth of 1.5 percent in 2025, suggesting that the rate is behind what is expected from refined copper demand. The majority of the increase will come from mines returning to normal operations, with additional amounts from projects or expansions that began ramping up in 2025.
Cruz stated that pre-disruption growth was originally forecast at around 2 million MT in 2026, but has since been downgraded by around 700,000 MT, with the majority of the reduction coming from Escondida.
“We see that supply coming in this year will be highly skewed towards H2 as mines recover, with a 9 percent increase between Q1 and Q4, with most of this growth coming from South America, Africa and Asia, ex-China,” Cruz said.
From there, he expects growth to stabilize in 2027 at a much higher rate than this year, with Africa to experience a faster growth rate than the overall market. In the long run, Cruz predicts a compound annual growth rate of 0.9 percent between 2025 and 2035, with copper output peaking in 2033 at 27 million MT.
Copper demand drivers to watch
One of the main areas Cruz focused on was the acceleration of demand driven by the energy transition, artificial intelligence and technology. A lot of the new demand is coming from electric vehicles (EVs) — while the…
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