Copper prices are set for further gains in 2026. Tightening supply, widening market deficits, and mine disruptions all amplify concerns about the metal’s long-term availability. UBS is the latest bank to upgrade the yearly outlook, warning that persistent operational setbacks and falling inventories are now exerting a decisive influence on the market.
In a note published Friday, UBS raised its March 2026 copper target by $750 per metric ton to $11,500, while lifting its June and September forecasts by $1,000 each to $12,000 and $12,500.
The bank also introduced a new December 2026 target of $13,000 per ton. The revisions come alongside sharply higher deficit projections: UBS now anticipates a 230,000-ton shortfall in 2025 and a 407,000-ton deficit in 2026—both several times larger than earlier estimates—as refined output growth slows to just 1.2% and 2.2% across the two years.
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UBS cited multiple mine disruptions as a clear sign of tightening supply. This year’s setbacks include lower-than-expected recoveries in Chile and recurring unrest in Peru. Furthermore, operational issues at Freeport-McMoRan’s (NYSE:FCX) Grasberg complex in Indonesia weigh on production.
Freeport’s Delays
The largest domestic copper miner continues to recover from a September mudflow at the Grasberg Block Cave that killed seven workers and halted operations. The expectations are to restart Block Cave in the first quarter of 2026 and produce 478,000 tons of copper cathode. Meanwhile, the initial goal was 700,000.
Yet the demand continues in the opposite direction. UBS expects global copper consumption to grow by 2.8% in both 2025 and 2026, driven by electric vehicles, renewable energy, grid upgrades, and rapidly expanding data center construction.
The divergence has made copper assets extraordinarily valuable and increasingly difficult to buy. BHP’s (NYSE:BHP) dramatic, last-minute attempt to derail Anglo American’s (OTCQX:AAUKF) planned $53 billion combination with Teck Resources (NYSE:TECK) shows how competitive the race for copper has become.
$100 Billion Budget
Copper’s strategic importance is also reshaping government policy. Securing supplies of copper and other critical minerals has become a matter of national security for the United States, which has unveiled billions in support through multiple agencies.
The largest single source of funding is the U.S. Export-Import Bank (EXIM). The bank plans to invest $100 billion as part of a broader effort to counter Western dependence on China and Russia.
“We can’t do anything else that we’re trying to do without these underlying critical raw material supply chains being secure, stable and functioning,” newly appointed EXIM chair John Jovanovic told the Financial Times.
EXIM has already provided a $1.25 billion loan for Barrick’s (NYSE:B) Reko Diq project in Pakistan, and Jovanovic said the bank is now working on several additional critical-minerals transactions “orders of magnitude larger,” though he offered no further details.
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