ObaisCap Copper Market Forecast 2026 Price Supply Demand

Copper is ending 2025 with a bullish tone: prices have pushed to record/high multi-year territory, while supply constraints and policy-driven trade flows keep the market sensitive to any disruption.
ObaisCap’s base case is simple: the copper market is tight in the “right places,” and that tightness matters more than headline narratives.

Key points to anchor your copper market analysis:

Price strength is real: LME copper moved around the $12,000/t area in late December 2025; COMEX copper hovered around $5.7/lb.
Inventories are telling a story: LME stocks were around the ~157k tonne level in late December, while COMEX warehouse stocks were reported near record highs (reflecting reshuffled global flows).
2026 risk is asymmetric: multiple credible outlooks warn that structural deficits become more likely as electrification demand grows faster than new mine supply can respond.

1) Where the Copper Price Is Right Now (LME vs COMEX)

A useful copper market outlook starts with benchmarks:

LME copper (global reference)

Late-December pricing showed LME copper around the $12,000/t region, with daily prints (cash/3-month) in that neighborhood. For example, Westmetall’s table shows LME 3-month roughly $12,220/t (Dec 24, 2025) and nearby days close to that level, alongside LME stock figures.

COMEX copper (U.S. reference)

On the U.S. side, copper traded around $5.7/lb late December 2025. TradingEconomics lists copper near $5.71/lb on Dec 29, 2025.
CME quotes also showed Dec 2025 HG in the mid-$5.7/lb area with nearby 2026 months slightly higher, consistent with a firm forward curve.

Why the spread matters

In 2025, the market wasn’t just “copper up or down.” It was also where copper is priced and stored. Policy expectations and trade frictions contributed to unusual flows and a persistent COMEX–LME dislocation at times, which is itself a bullish signal of localized tightness.

ObaisCap view: when copper prices are strong and the pricing relationship between exchanges is unstable, it usually means the copper market is being driven by availability and deliverability, not just macro headlines.

2) Copper Demand: Electrification Is the Core, but Cycles Still Matter

Any serious copper market analysis has to separate structural demand from cyclical demand.

Structural copper demand (the long game)

Copper is a “wiring metal,” and the wiring theme is not slowing:

Power grids, renewables, EVs, and charging infrastructure keep raising copper intensity.
Data center buildouts (AI-driven capex) add a second structural channel via power distribution and cooling-heavy electrical systems.

Mainstream market commentary in late 2025 repeatedly framed the rally around green-energy transition demand and expectations of long-run scarcity.
The IEA’s critical minerals outlook also explicitly models strong growth pathways for energy transition minerals (including copper) under multiple scenarios.

Cyclical copper demand (the short game)

Copper is still sensitive to:

China’s property/construction pulse
manufacturing PMIs
global credit conditions

So even in a bullish copper market, you can still see sharp pullbacks when growth expectations wobble. The trend can be up while the path is volatile.

ObaisCap view: the copper market is increasingly “structural-bullish, cyclical-noisy.” That’s why risk management matters more than narrative confidence.

3) Copper Supply: Grades, Capex, Permitting, and Disruptions

Copper supply has two chronic issues: time and fragility.

New copper supply is slow

Large copper projects take years due to:

permitting timelines
capex inflation
community and water constraints
grid and logistics build-out

This is why many analysts talk about looming deficits: demand can ramp faster than a mine can. The IEA has highlighted deficit risks in public commentary covered by financial media.

Existing copper supply is fragile

2025 price action was also linked to supply disruptions and reduced production expectations in some narratives, which adds a risk premium because inventories are not huge.

ObaisCap checklist for supply: watch mine-level news (strikes, outages), treatment charges (TC/RC), and scrap availability—because in a tight copper market, marginal tons set price.

4) Copper Inventories: The Market’s “Truth Serum”

When traders debate whether copper is “really tight,” inventories settle the argument.

Westmetall’s LME data showed LME copper stocks ~157,025 tonnes (Dec 24, 2025)—not massive by historical standards for a market this big.
Meanwhile, reporting in late 2025 indicated COMEX warehouse stocks surged (even described as record levels), reflecting trade flow distortions and “pull-forward” behavior into the U.S.

This divergence matters:

High COMEX stocks can coexist with tightness elsewhere (especially if metal quality/origin constraints reduce fungibility).
Lower LME stocks can amplify price sensitivity in global spot markets.

ObaisCap view: the copper market is not one pool—it’s multiple pools connected by rules, freight, finance, and politics. That’s why “inventory where?” is the most important copper question.

5) Macro Drivers: Dollar, Rates, and the “Commodity Bid”

Copper doesn’t trade in a vacuum. In late 2025, market coverage linked copper’s surge to:

expectations of rate cuts
a weaker dollar
broad investor appetite for real assets

In practical terms:

A softer USD typically supports USD-priced commodities (including copper).
Easier financial conditions can lift risk appetite, which can lift copper.

ObaisCap view: macro is the accelerator, not the engine. The engine is physical copper availability and forward supply risk.

6) 2026 Copper Market Outlook: Three Scenarios (Base / Bull / Bear)

ObaisCap frames outlooks as triggers, not prophecy.

Base case (most likely): Elevated copper prices with volatility

What it looks like: copper holds a high plateau, swings widely, but remains supported by structural demand narratives and supply inertia.
Triggers to watch: stable-to-falling visible stocks, continued capex bottlenecks, steady electrification orders.

Bull case: “Scarcity premium” expands

What it looks like: prices push higher on renewed disruption, policy shocks, or a faster deficit narrative.
Typical triggers: mine disruptions + low buffer inventories; intensified regional tightness and spreads.

Bear case: Growth shock or demand air-pocket

What it looks like: copper sells off sharply on recession fears, China weakness, or credit tightening—then stabilizes as longer-term buyers return.
Triggers: collapsing PMIs, global industrial slowdown, sudden inventory rebuild.

7) What to Monitor Weekly (A Practical Copper Market Dashboard)

If you publish copper market analysis (or trade it), keep repeating the right indicators:

Copper price (LME 3M, COMEX HG) — the headline, but not the whole story.
Copper inventories (LME + COMEX) — tells you where tightness is real.
Spreads and regional premia — signals deliverability stress.
Project pipeline / capex news — tells you whether supply can respond in time.
Macro (USD, rates) — sets the “risk-on/off” temperature.

8) Strategy Notes (Investors, Traders, and Businesses)

For traders:
In a tight copper market, the best trades often come from inventory signals and spread behavior, not from guessing macro headlines.

For manufacturers and consumers of copper:
If margins are sensitive to copper price, consider structured hedging—because “high and volatile” is still risk, even if you’re bullish long term.

For long-term investors:
A copper market built on electrification demand can reward patience, but entries matter; use pullbacks as research events, not emotional events.

This article is for informational purposes only and is not financial advice.

FAQ: Copper Market Questions People Search

Is copper still bullish after the 2025 rally?
Copper finished 2025 with strong momentum and recurring “tight supply / structural deficit” narratives, but volatility risk remains high.

Why do LME and COMEX copper prices diverge?
Regional constraints, trade flows, and deliverability rules can create spreads—especially when policy risk reshapes where copper is stored and delivered.

What’s the single best indicator for copper tightness?
Visible inventories and spread behavior are among the cleanest signals—particularly LME stock trends versus regional demand pressure.