Chile's Codelco is reportedly offering its European customers copper at a record premium of $350 a metric ton for next year, up more than 7% from $325 this year, according to two sources with knowledge of the matter, as reported by Reuters. Codelco, the world's biggest copper miner by production, declined to comment. Premiums set by Codelco for physical delivery of refined copper are paid on top of London Metal Exchange (LME) prices and are often referenced as a benchmark in global supply contracts for the metal, which is used in electric vehicles, grid infrastructure and construction.
The reported premium emerged as the global metals industry gathers in London for LME Week. According to the report, it points to an emerging trend of higher copper premiums for next year due to expectations of shortages in Europe. Aurubis (ETR: NDA), Europe's biggest copper smelter, last week raised its 2027 premium by around 10% to $347 a ton, also a record for the German company, according to the same report.
The report attributes expected shortages in the world outside the United States to expectations of US tariffs on copper imports. Traders have been shipping copper to the US since President Donald Trump ordered a study on the potential for tariffs in February last year. The prospect of US tariffs has pushed Comex prices to a record high of $6.83 a lb, or $15,057 a ton, on September 22, according to the report.
Comex-approved warehouses in the US hold around 70% of the world's visible copper stocks. Mine disruptions have also helped keep copper prices elevated. The report cites Codelco's El Teniente deposit, which was hit by a deadly landslide this month.
The metal hit a record high of $14,875 a ton on the LME last month and was last around $14,380 a ton, according to the report. Codelco offers separate premiums for the US and Asian markets, including China, the top metals consumer. Source: Reuters, reported via Kitco.com.
Source: kitco.com