The U.S. stockpiled 200,000 tons of refined copper in July. Why is the U.S. so eager to hoard copper—and what impact will this have on global supply chains?

Traders believe that if they don’t ship now, they’ll face a 15% tariff increase next year and a 30% hike the year after—cutting deeply into profits. COMEX prices are far higher than LME prices—even after accounting for freight costs, traders still pocket a premium. In July, the average price spread ranged from $350 to $400 per ton, peaking at $500–$600 per ton. Maritime shipping, insurance, warehousing, and financing costs combined amount to only about $200+ per ton—the rest is pure profit. Profitability has triggered a massive relocation of copper from European and Asian warehouses to U.S. delivery points, causing LME inventories outside the U.S. to plummet and COMEX stocks to hit their highest level since 1989. Tariff arbitrage is now the dominant market driver—overshadowing even real demand—though actual copper demand remains exceptionally strong. AI and new energy sectors are major demand drivers: an AI data center consumes three times as much copper as a traditional facility; an electric vehicle uses four times more copper than a gasoline-powered car; power grids, energy storage systems, submarines, and missiles all require substantial copper. Meanwhile, annual U.S. domestic copper mine output stands at just around one million tons—insufficient even to build data centers alone. Thus, the U.S. aims to draw in global physical copper supplies—effectively securing a strategic reserve at zero cost. Copper mine supply is genuinely tight: it takes 5–8 years from exploration to production, with no meaningful new capacity coming online in the short term. Chile is cutting output; Indonesia’s resumption of operations has been delayed; African output is declining; and the treatment charge (TC) has plunged to -$160/ton—meaning smelters not only earn no processing fees but must pay miners outright. Such a situation is unprecedented in history, underscoring extreme ore scarcity. Top copper mining companies collectively produced 5.67 million tons in H1 2026—a 5% year-on-year decline and only a 3% sequential increase. Freeport’s Q1 output crashed 24% YoY; full recovery in Indonesia—delayed by mudslides—is now pushed to 2028. BHP’s full-year copper output fell 3% YoY; the grade at its largest mine dropped from 1.02% to 0.90%, and is expected to fall further. Antofagasta’s H1 output declined 9.5%. Ivanhoe slashed its Kamoa production guidance. Codelco openly admitted it has failed to meet its annual production targets every year for the past seven years—and its 2026 guidance falls over 300,000 tons short of its previous target.

With U.S. Treasury debt collapsing, what are the trends for gold, silver, and AI?

Scottish firm DataVita secured £300 million (approx. $407 million) in financing from ING Bank, ABN AMRO, and other European banks to expand its existing data center in Scotland and build a new one. The UK government facilitated this financing by guaranteeing 80% of the £252 million provided by two Dutch banks and Spain’s Santander Bank. The remaining funds will be supplied on an unsecured basis by the Scottish National Investment Bank and Siemens Financial Services. Dell, a major player in computing infrastructure, plans to relocate its Scottish headquarters to the site. This investment marks a pivotal signal of revival for the UK’s so-called ‘AI Growth Zones’ under newly appointed Prime Minister Burnham—previously established by former PM Starmer as a cornerstone of the Labour government’s AI policy. China’s industrial robot output rose 28.5% year-on-year in the first seven months of the year. (Given this data, long-term concerns about AI’s massive capital expenditure may be somewhat overstated—though saying so now requires considerable courage.) According to the National Bureau of Statistics: From January to July, China’s real estate development investment totaled RMB 430.09 billion—down 19.2% year-on-year; total retail sales of consumer goods reached RMB 2.87744 trillion, up 1.2% YoY. In July, value-added industrial output grew 4.5% YoY; and in first-tier cities, new residential property prices turned flat month-on-month after rising 0.1% in June. (What’s your immediate reaction upon seeing these figures? Could this signal renewed room for monetary easing?) To standardize and guide production licensing for cocoa and roasted coffee products—and strengthen food safety oversight—the State Administration for Market Regulation has drafted the ‘Review Criteria for Production Licensing of Cocoa and Roasted Coffee Products (Draft for Public Comment)’, now open for public feedback. All relevant organizations and individuals are invited to submit comments via the ‘Public Comment Feedback Form’ before September 18, 2026. Cocoa prices and historical volatility. The London Metal Exchange (LME) key indicator measuring near-term supply tightness surged sharply, pushing copper prices back into high volatility. The price of the LME contract expiring tomorrow traded at a $75/ton premium over the contract expiring the day after—a spread not seen since January, when the LME benchmark copper price hit an all-time high and the spread briefly reached $100/ton. As signs of tightening supply mount, copper prices surge and spreads widen, drawing close attention from commodity traders. Much of this supply strain stems from traders rerouting hundreds of thousands of tons of copper to the U.S. ahead of the Trump administration’s final decision on import tariffs. On Tuesday, the ‘Tom/Next spread’—the cost to roll positions forward by one day—widened significantly, indicating mounting pressure on short positions ahead of Wednesday’s expiry of the LME August contract. On Monday, spot copper briefly traded $545/ton above the three-month futures price. Boosted by higher commodity prices, BHP Group’s fiscal-year profit rose nearly one-third—and for the first time ever, its annual copper revenue surpassed iron ore revenue. BHP reported on Tuesday that its underlying profit for the fiscal year ended June reached $13.2 billion—up 30% YoY and exceeding analyst expectations.

BHP Copper Production Falls by a Fifth on Lower Chile Output

Oct 19, 2026

BHP Group reported a 19% drop in quarterly copper production due to weather and lower ore grades in Chile, maintaining full-year guidance. The miner also noted steady iron ore output and progress on its Jansen potash fertilizer project.

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