Copper may test USD 13,500/ton by first half of 2026 amid supply constraints: Experts

"Copper has already gained by almost 40 per cent in 2025," said Ajay Suresh Kedia, founder and director of Kedia Advisory, in an interview with ANI. "Factors are still variable for copper. We are expecting copper prices to test USD 13,500 per ton on the LME, and domestically, we can see prices moving to the level of Rs 1,350 per kg in the first half of 2026."

Currently, prices are hovering around Rs 1,150-1,170 per kg in domestic markets and USD 12,100 per ton in global markets.

Kedia said physical market indicators are strengthening. "Physical demand is improving, premiums are improving, and supply-side concerns are there," he said. "Looking at the silver-copper ratio also, we expect copper would be the next winner for 2026, with over substantial gain expected from current levels."

Copper prices recently rose to record highs, supported by strong economic signals from the United States and tightening supply conditions globally.

Amit Gupta, senior research analyst at Kedia Advisory, said robust US economic growth has supported copper-intensive sectors, while years of underinvestment, mine disruptions, and planned output cuts by Chinese smelters have added pressure on supply. Trade uncertainty, expectations of further US rate cuts, and a weaker dollar have supported speculative flows, while long-term demand from electric vehicles, renewable energy, power grids and artificial intelligence infrastructure remains strong.

Supply disruptions remain a key driver of prices, according to market participants. "Copper's move reflects concerns over global availability," said Ritesh Kumar Sahu, senior manager and research analyst for commodities at Kotak Securities. "Mine disruptions in Indonesia, Chile and Peru have further constrained output."

He said the impact is already visible across the supply chain. "The suspension of operations at Freeport's mine and slowing production across South America have tightened concentrate markets, forcing Chinese smelters to accept zero treatment and refining charges for 2026," Sahu said.

Trade policy uncertainty is also influencing prices, he added. "Renewed US tariff rhetoric has triggered pre-emptive stockpiling and drawn material into American warehouses," Sahu said. "With limited new mine capacity, structurally tight supply and resilient demand from technology and electrification sectors, copper is now on track for its strongest annual gain since 2009."

Adding to the bullish outlook, Subhranil Dey, senior research analyst at SMC Global Securities, said, "Copper prices are expected to rise further and may touch the level of 1,300 in the near future."

Industry veteran Anantha Padmanaban, founder member and former chairman of the All India Gem & Jewellery Domestic Council, said broader investor sentiment is also shifting toward metals. "People are tracking the copper-to-gold ratio, and many believe copper could be the next big thing," he said. "Confidence in the dollar has gone down, so investors are shifting into metals."

Padmanaban added that fears of instability in global equity and property markets could further support copper prices if financial market volatility rises. (ANI)