Copper prices touched a fresh record high on the LME this week, driven by tight global supply and growing US tariff expectations.

The metal touched $14,533 a ton on the LME, breaking past its previous record set back in January. Benchmark three-month copper futures rose as much as 0.8% during the session. Two main forces are pushing prices higher right now.

The first is simple supply and demand. Big copper mines around the world are struggling to keep up with rising usage from data centres, renewable energy projects and power grids, and that gap has been building for years.

The second driver is more immediate. Traders have been shipping large volumes of refined copper into the United States, betting that President Trump will expand tariffs to cover imports of the metal.

This has pulled copper out of LME warehouses and concentrated stockpiles in the US instead, leaving the rest of the world with tighter near-term supply.

That squeeze has already shown up in the market. Last month, LME warehouse stockpiles fell to critically low levels, triggering a sharp supply crunch.

Prices have stayed in what’s called backwardation, where near-term prices trade higher than future contracts, a sign that buyers are struggling to get their hands on copper right now.

China, the world’s largest copper consumer, is also expected to add to demand as its manufacturing sector enters its usual peak season. Inventories on the Shanghai Futures Exchange dropped to their lowest level since 2024 last week.

Adding to supply worries, several major mining regions have faced operational setbacks this year.

Chile, the world’s top copper producer, posted its weakest second-quarter output in nearly two decades and has cut its full-year production forecast twice in a row.

Elsewhere in metals, zinc rose 1.1% and aluminium gained 0.1%, while iron ore futures climbed 0.8% to $101.10 a ton in Singapore trade.

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