- Peru copper output growth offsets weaker Chilean mine production
- LME copper inventories fall over 20% since end-May
LME copper prices remained firm during the week, rising from around $13,450/t to approximately $13,600/t on 16 July 2026, up 1.1% w-o-w. The gains were supported by a weaker US dollar, continued tightening in physical supply, and ongoing uncertainty surrounding potential US copper import tariffs, which continued to encourage inventory movements into the United States and supported global market sentiment.
Meanwhile, LME copper inventories declined by 1.9% w-o-w, falling from 306,500 t to 300,600 t as of 16 July, highlighting persistent tightening in exchange stocks. Supply-side sentiment also remained supportive after BHP reported a 3% y-o-y decline in FY’26 copper production to 1.95 million tonnes, primarily due to lower ore grades at its Escondida mine in Chile.
However, copper prices remained capped near $13,600/t as speculative buying moderated following the absence of clarity on the US tariff decision after the Commerce Department’s review deadline. At the same time, renewed tensions in the Middle East lifted oil prices and heightened inflation concerns, raising expectations that interest rates could remain elevated for longer and limiting further upside in industrial metals.
Despite these headwinds, declining inventories and ongoing supply constraints continued to provide a solid floor for LME copper prices.
Global updates
Chile-based Antofagasta reported a 9.5% y-o-y decline in first-half 2026 copper production to 285,000 t, mainly due to lower output at its Los Pelambres and Centinela operations. Second-quarter production also edged down 0.7% q-o-q to 142,000 t.
Despite the weaker first-half performance, the company maintained its 2026 production guidance of 0.65-0.7 mnt, expecting stronger output in the second half supported by improved ore grades and higher processing volumes.
Peru’s copper production increased by 2.3% y-o-y to 0.25 mnt in May’26, supported by higher output from major mines including Anglo American’s Quellaveco, Southern Copper, and Las Bambas. The continued growth in Peruvian copper output is expected to provide additional supply to the global market, partially offsetting production weakness reported by some Chilean miners.
India’s updates
Indian copper scrap prices increased by 3% w-o-w during the week, supported by the recovery in LME copper prices and a weaker US dollar. However, domestic trading activity remained subdued as monsoon-related seasonality and cautious buying by secondary manufacturers limited spot transactions.
Meanwhile, Copper cathode prices in western India edged higher by 0.8% during the week, supported by firmer import premiums. Despite the price increase, buying activity remained largely requirement based as downstream consumers limited purchases amid elevated prices and uncertainty surrounding proposed US copper import tariffs. Comfortable domestic availability and higher local production ensured adequate spot supplies, while sellers-maintained firm offers on expectations of further strength in global copper prices.
Outlook
LME copper prices are expected to remain broadly supported in the near term as tightening exchange inventories, constrained mine supply, and resilient structural demand continue to underpin market fundamentals.
However, trading activity is likely to remain cautious as market participants await clarity on the proposed U.S. copper import tariffs. Until there is further clarity, copper prices are expected to remain range-bound despite supportive physical market fundamentals.
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