Copper dropped to its lowest in 10 days on Thursday as hotter-than-expected US inflation revived talk of another Federal Reserve rate hike, a rout in Asian chip stocks spread to the metals complex and a deal at Escondida took the most immediate supply risk off the table.
Comex copper for December delivery fell 1.2% to $6.5810 a pound (about $14,508 a tonne) by late morning in New York, after trading as low as $6.5245 earlier in the session. The most-active contract is now 4.5% below the record settlement of $6.89 set on September 9 and heading for a third straight daily loss, the longest losing streak since June.
In London, three-month copper eased 0.9% to $14,360 a tonne in official trading after touching $14,289, the weakest since October 5. Cash copper settled at $14,751 on Wednesday, $116 over the three-month price, and LME inventories have fallen to 228,000 tonnes, down 8% since the start of the month. The most-traded contract on the Shanghai Futures Exchange lost 1.9% to 108,940 yuan ($16,276) a tonne.
“Two things are happening at the same time: the easing worries of supply and the strong inflation report,” Ole Hansen, head of commodity strategy at Saxo Bank, told Reuters. “That was too much for the market to chew in one go and some profit-taking is emerging.” The technical picture is deteriorating too, Hansen said, with copper challenging an uptrend that began in March and edging below its 50-day moving average.
US consumer prices accelerated in September at the fastest pace in five months, Wednesday’s data showed, putting a rate hike later this month back on the table and lifting the Bloomberg Dollar Index to its highest since May 2025. Higher rates hurt metals twice over, by cooling demand and raising the cost of carrying inventory, and the market was already nervous about the other pillar of this year’s rally. South Korea’s Kospi fell almost 8% on Thursday, dropping into a bear market as investors questioned how long the artificial intelligence spending boom can last, and the memory-chip selloff that began earlier in the week spread across Asian tech.
“For copper, it’s a double whammy of the AI trade coming under pressure from the sell-off in chip stocks, and the impact of rising Fed rate hike odds,” Kyle Rodda, senior financial market analyst at Capital.com, told Reuters. Sucden Financial expects “the firm dollar and renewed rate pressure to keep the complex defensive, with copper’s remaining supply risks offering only very limited support,” its analysts wrote in a note.
Escondida signs, Antofagasta stalls
Those supply risks shrank on Wednesday afternoon, when supervisors at BHP’s Escondida in Chile ratified the agreement their union had struck with the company hours earlier, removing the threat of a stoppage at the world’s largest copper mine. Unionized workers at Antofagasta’s Centinela remain on strike, and the open pit at Codelco’s El Teniente is still shut after last week’s landslide, but the 5% of Chilean output that GEM Mining Consulting rated at risk a week ago has narrowed considerably.
Antofagasta itself reported a 7% rise in third-quarter copper production and held its 2026 guidance of 625,000 to 655,000 tonnes despite the Centinela strike, but it was the year after that spooked investors. The company now expects 630,000 to 690,000 tonnes in 2027, below its original 650,000 to 700,000 tonnes and short of BMO Capital Markets’ 703,000-tonne estimate, and lifted its cash cost guidance on higher diesel prices. The outlook “implies no growth on the original guidance for 2026,” RBC analysts wrote, despite better grades at Los Pelambres and the Centinela expansion coming on stream.
Tariff odds fade with the spread
The selloff has also drained what was left of the tariff premium in the Comex curve. December copper in New York settled on Wednesday just $49 a tonne over the LME three-month official price, down from a gap of about $175 on Tuesday, and on Macquarie’s arithmetic that puts the market-implied odds of a 15% import duty arriving on schedule in January at roughly 2%, against the 10% the bank read into the spread at the end of September.
That is the “very binary” setup the bank described in its latest quarterly, in which a decision against a tariff would see the Comex price “collapse, taking the LME price with it” and surplus US stocks reappear in LME warehouses. Macquarie counts a 223,000-tonne surplus this year and surpluses above 700,000 tonnes a year from 2027, a view the International Copper Study Group broadly shares with its forecast of a 368,000-tonne surplus next year, while BMO argues that the near-2 million tonnes sitting in the United States is China’s strategic reserve relocated rather than surplus, and has copper averaging $14,675 next year.
Miners follow the metal lower
Copper producers fell with the metal on Thursday. Freeport-McMoRan dropped 2.4% to a $98 billion market value and Southern Copper 2.4% to $165 billion, with BHP down 1.4% at $213 billion, Rio Tinto 1.3% lower and First Quantum off 1.7%. Lundin Mining lost 1.0% and Ivanhoe Mines 1.5%, while Teck Resources, up 0.5%, was the only major copper producer in positive territory. Freeport has now shed 5.5% over the past week.
Antofagasta was the day’s casualty, down 6.4% to £33.40 in London for a market value of close to £33 billion, taking its loss over the past week to 10%. The stock is now flat for 2026, as is First Quantum, against gains of 41% for Southern Copper, 37% for Glencore, 36% for BHP and Teck, and 34% for Freeport.
Polish state miner KGHM, up 2.4%, bucked the trend after the EU put its $2.4 billion of copper projects on a fast track last week.
Comex copper is up about 17% in 2026.
(With files from Reuters and Bloomberg)