The latest surge has been driven more by expectations of future tightness than by current supply-demand fundamentals, Goldman Sachs said.
- Goldman does not expect supply shortages until 2029.
- The firm expects copper prices to remain range-bound between $10,000 and $11,000 per ton.
- The metal hit a record high of $11,540 per ton on the London Metal Exchange on Wednesday.
Copper’s blistering rally drew fresh scepticism from Wall Street, with Goldman Sachs reportedly warning that the metal’s recent breakout is unlikely to last.
On Wednesday, copper touched a record high of $11,540 per ton on the London Metal Exchange.
According to a Bloomberg report, Goldman Sachs said the latest surge has been driven more by expectations of future tightness than by current supply-demand fundamentals. “We do not expect the current breakout above $11,000 to be sustained,” analysts wrote.
What Drove The Prices?
Prices have been propelled higher by concerns over a global supply squeeze, especially as traders rush metal into the U.S. ahead of potential tariffs. Trading giant Mercuria Energy Group recently warned of supply shortages emerging early next year. Still, Goldman believes global inventories may not fall to critically low levels. The firm expects demand to drop about half a million tons short of supply this year, and no shortages until 2029.
“While our much smaller 2026 surplus of 160,000 tons moves the market closer to balanced, it means that we do not expect the global copper market to enter a shortage any time soon,” Goldman said, expecting prices to remain range-bound between $10,000 and $11,000 a ton.
China’s near-term weakness is another factor tempering Goldman’s outlook. The firm projects an 8% year-on-year drop in Chinese consumption in the fourth quarter, followed by a modest 2.8% rebound next year.
Why The Rally Could Continue
Not everyone shares the cautious tone. JPMorgan expects the rally to extend, forecasting copper to reach $12,500 per ton by the second quarter of 2026. The firm highlighted rapid growth in data-center construction, which could add roughly 475,000 tons of copper demand in 2026, up about 110,000 tons from this year, as computing and AI-related infrastructure expands.
The copper market has already gained more than 30% this year, with U.S. futures soaring even higher as investors bet the Trump administration will eventually impose broader tariffs on primary copper forms.
Although July’s market panic over a rumored 50% tariff did not materialize, the administration left open the possibility of revisiting the decision in 2027, prompting traders to accelerate shipments to U.S. ports.
According to Mercuria, these dynamics could spark an acute global supply squeeze by early next year, potentially pushing copper prices even deeper into record territory.
Read also: USAR Stock Gains 16% As Newly Acquired Unit Strikes Rare Earth Deal With Arnold Magnetic Technologies
For updates and corrections, email newsroom[at]stocktwits[dot]com.<