Copper has reached a record high: what is the reason
5 December 13:11
Copper reached a record high on Friday, December 5, after Citi raised its forecast for the price of the industrial metal: supply concerns and optimism around a likely Fed interest rate cut next week supported the market, "Komersant Ukrainian" reports citing Reuters.
The copper contract on the Shanghai Futures Exchange SCFcv1 ended the day’s session up 2.19% to 92.780 yuan ($13.125.28) per metric ton, setting a new all-time high of 92.910 yuan during the session.
Since the beginning of the week, copper on the Shanghai Futures Exchange has risen by 4.99%. The London Metal Exchange’s copper contract for delivery in three months, CMCU3, jumped 1.90% to $11,667.60 per tonne by 09:05 Kyiv time, having peaked at $11,705 earlier in the day.
Copper on the London Metal Exchange may end the week up 4.32%. Citi analysts expect copper prices to continue to rise in early 2026 and average around $13,000 per tonne by the second quarter of 2026, up from an October forecast of $12,000. At the same time, in their bullish scenario, prices could reach $15,000, compared to the previous estimate of $14,000.
The bank believes that prices will continue to be supported by macro-focused investment fund purchases as investors prepare for a soft landing in the US economy, and amid a widening supply shortage as mining supply growth fails to keep pace with accelerating demand driven by the energy transition and artificial intelligence.
Even more tightness in the market is expected due to the accumulation of US stocks associated with the COMEX-London Metal Exchange arbitrage, the bank added.
Strengthening hopes for a Fed rate cut next week also supported the copper market.
