This report examines the copper market's fourth-quarter trajectory, where tightening supply-side constraints and shifting demand structures are expected to support higher price levels. The market enters Q4 with a bullish-leaning consolidation pattern, though macroeconomic headwinds may cap extreme upside moves rather than reverse the underlying trend.
Market Recap for the First Three Quarters of 2026
The copper market navigated two major shocks in the first nine months of 2026: geopolitical conflict and a shift in Federal Reserve policy direction, with the unresolved US Section 232 copper tariff keeping prices elevated. By late September, both COMEX and LME copper prices reached record highs.
The Middle East conflict between the US and Iran escalated on February 28, spiking crude oil prices above USD 120 per barrel on supply disruption fears through the Strait of Hormuz. This triggered stagflation concerns, raising smelting and processing energy costs, which pressured risk-metal valuations in the short term. On June 18, the Federal Reserve's FOMC meeting delivered an unexpectedly hawkish signal, fully reversing the narrative of imminent rate cuts. The updated dot plot showed nearly half of committee members supporting a rate hike within the year, sending the US dollar index and 10-year Treasury yields higher simultaneously. Copper prices corrected temporarily, but support from mine supply constraints and tariff expectations helped SHFE copper hold above the RMB 100,000/ton level. By September 8, the main SHFE copper contract closed above RMB 110,000/ton at RMB 110,620. On September 10, LME copper touched an intraday record high of USD 14,875/ton. Following the Fed's September 16 rate hike, copper prices gave back some gains, with three-month LME copper settling at USD 14,515/ton on September 18, still within historically high territory.
Throughout the first three quarters, geopolitical conflict, risk aversion, and stagflation-rate hike concerns constrained copper valuations. Internally, global copper mine production cuts and persistently declining treatment charges (TCs) meant supply contraction outpaced any demand slowdown. Despite significant external shocks, strong internal drivers kept copper prices above RMB 100,000/ton and probing the RMB 110,000 level. Entering Q4, the market's focus shifts to US Section 232 refined copper tariff expectations and low inventories against a backdrop of tight supply.
Global Economic Landscape in 2026: Geopolitical Conflict Stoking Stagflation Pressures
The global economy in 2026 faces intensifying geopolitical disruption and stagflationary pressures, leading to greater divergence among economies. The IMF's July update to its World Economic Outlook reassessed global growth and inflation patterns: global GDP growth is under pressure, inflation is rebounding, major central banks are increasingly expected to raise rates, and global liquidity is tightening.
Global GDP growth for 2026 has been downgraded to 3.0%, with a forecast of 3.4% for 2027. Middle East conflict is elevating energy prices and suppressing global aggregate demand. The impact of geopolitical shocks is uneven, hitting energy-importing nations and vulnerable emerging economies harder, while economies deeply integrated into the AI technology value chain show greater resilience. US GDP is projected at 2.4% in 2026 and 2.1% in 2027; the lagged effects of tariff policies and higher energy costs provide a minor drag, but corporate AI capital expenditure and private investment resilience offset downward pressure. China's GDP is forecast at 4.4% in 2026 and 4.0% in 2027. A prolonged property market adjustment, weak consumer confidence, and slow local government debt repair have led to 2026 growth expectations being revised down; structural pressures persist into 2027, pulling growth down to 4.0%.
The Middle East geopolitical conflict has escalated from a tail risk into a core constraint on global macroeconomic pricing, interrupting the recovery momentum from AI investment and trade détente. With downward growth revisions and rebounding inflation, the global economy moves into a phase of stagflation, disproportionately impacting emerging markets over developed economies. The economic outlook leans toward downside risks, with three key negative variables: conflict escalation, sovereign debt crises, and disappointing productivity gains from AI.
Federal Reserve: Potential Second Rate Hike Within the Year, High Rates Cap Long-Term Valuations
On September 16, the Federal Reserve raised its policy rate by 25 basis points for the first time in over three years, setting the federal funds rate target range at 3.75% to 4.00%. The latest dot plot indicates that 12 of 18 officials project one more rate hike this year, while four anticipate two more, suggesting a majority expect a second hike before year-end. The median policy rate projection for end-2027 remains at 4.1%, significantly pushing back expectations for rate cuts and leaving open the possibility of a third hike.
The impact on copper is clear: high interest rates and a stronger dollar depress copper's long-term valuation and financial attributes, pressuring global manufacturing capital expenditure and property-chain demand. However, in Q4, near-term pricing remains dominated by supply-demand dynamics and tariff expectations. Macroeconomic pressure mainly acts as a ceiling on price gains rather than a signal for a trend reversal.
China: Supportive Policies Intensify, Peak-Season Demand Awaits Confirmation
China's economy in the first three quarters of 2026 followed a path of stable Q1, pressured Q2, and policy-intensive Q3. Entering Q4, room for fiscal and monetary policy expansion has opened up. Grid investment maintains high momentum, supported by the traditional "Golden September, Silver October" construction peak season and year-end grid and new energy project grid-connections. Copper demand from computing infrastructure and energy storage sectors continues to grow robustly.
The property sector remains a key weakness. From January to August 2026, cumulative floor space completed fell 23.7% year-on-year, pressuring copper consumption tied to real estate chains, although the rate of decline is stabilizing. Policy signals are increasingly clear, with the Ministry of Housing and Urban-Rural Development setting the tone for a new long-term development model, new provident fund regulations implementation, and ongoing relaxation in first-tier and strong second-tier cities. The market anticipates potential stimulus for the peak sales season, urban village redevelopment, and existing stock revitalization. Infrastructure investment continues to provide a stabilizing effect, with cumulative investment in the January-August period up 1.1% year-on-year, as grid projects accelerate and serve as a key growth stabilizer, offsetting declines in property demand. The automotive sector continues to show structural divergence: total vehicle output from January to August was 20.255 million units, down 3.8% year-on-year, while new energy vehicle production reached 10.668 million units, up 10.8%. NEV growth and exports offset declines in fuel vehicle production, providing core support for copper demand in this sector.
Global Copper Mine Output Contracts, Treatment Charges Hit Record Lows
According to the International Copper Study Group's preliminary statistics for the first half of 2026, global copper mine production fell 1.1% year-on-year. Concentrate production (sulfide ore) declined a sharper 2.6%, while SX-EW (leaching) output grew 4.3%. The contraction in concentrate supply far exceeds the overall mine output figure, clearly indicating that sulfide copper concentrate is the primary bottleneck in current supply.
By country, Chile produced 2.481 million tons of copper in H1, down 6.6% year-on-year, with major mines like Escondida and El Teniente impacted by declining ore grades and maintenance disruptions. Cochilco has further lowered its full-year Chilean output forecast to 5.27 million tons, a 2.6% decline. Indonesia's output fell sharply year-on-year in H1 due to the ongoing mud inflow incident at Grasberg mine. While phased production ramp-up began in Q2, capacity is expected to reach only around 65% in the second half of 2026, with full production delayed until end-2027. The Democratic Republic of Congo saw overall mine output roughly stable, with growth in leached copper. However, Kamoa-Kakula faced earthquake-related flooding at the mine, restricting access to high-grade zones and causing output to miss plan in H1. The company has revised its full-year guidance down to 290,000 to 330,000 tons of anode copper, a result of the mine's own geological issues rather than export controls.
Consolidating forecasts from domestic and international institutions, expectations for 2026 global copper mine supply growth have been revised down substantially from earlier in the year. Total mine copper growth is now projected at just 50,000 to 220,000 tons, representing a 0.2% to 1.0% growth rate, but with extreme structural divergence: nearly all incremental growth comes from leaching oxide ores, while sulfide concentrate supply is close to zero growth. This near-zero growth in concentrate is the fundamental reason spot TCs have remained deeply negative.
Global Copper Concentrate Supply: Frequent Mine Disruptions, TCs Plumb Historic Lows
In H1 2026, the combined output of 18 major global producers reached 6.613 million tons, a decrease of 349,000 tons year-on-year, highlighting significant production cuts among top-tier mines. Glencore, Teck Resources, Southern Copper, and CMOC contributed the most to growth, while Freeport-McMoRan, BHP, Codelco, and Ivanhoe Mines all saw significant output reductions.
Global Refined Copper Supply: Triple Constraints Force Downward Revisions
Global refined copper supply in 2026 faces a triple-constraint environment: persistent cuts in raw material mines, negative smelting margins, and enhanced sulfur resource constraints. Full-year primary refined copper growth has been significantly revised down, with supply elasticity markedly weakened.
At the macro level, ongoing Middle East tensions disrupt sulfur flows through the Strait of Hormuz, compounded by domestic sulfuric acid export controls in China. This has sharply tightened global sulfur supply-demand dynamics, driving prices substantially higher throughout the year, peaking above RMB 2,100/ton mid-year and remaining elevated through Q3. As sulfuric acid is a core raw material for leaching operations, the price surge has significantly raised production costs for overseas low-grade leaching copper mines, forcing some high-acid-consumption operations to cut capacity, further compressing global mine supply elasticity.
Treatment charges for copper concentrate have stayed in deep negative territory throughout 2026, becoming the core variable constraining smelting output. Concentrated disruptions — including the Grasberg mudslide in Indonesia, geological disturbances in DRC mines, and declining ore grades and water constraints in Chile — have continuously shrunk global sulfide concentrate supply. By end-September, spot TC fell below negative USD 220/ton, a historic low, and remained in negative territory for most of the year. These abnormally low charges have completely squeezed profitability from the global smelting sector, forcing conventional copper smelting operations into sustained losses. Smelters have significantly reduced operating rates, increasing maintenance shutdowns and curtailments.
This year, the profit structure of China's smelting industry has seen a marked reversal. Revenue from by-product sulfuric acid sales partially offsets losses from deeply negative copper concentrate TCs, providing crucial support maintaining domestic smelter operations. Most overseas smelters, lacking channels to monetize sulfuric acid, continue to bear significant losses. The industry's operating logic has shifted from being "TC-driven" to "sulfur-price-driven."
With 2026 global mine copper growth expectations sharply revised down, sulfide concentrate supply near zero growth, and only minimal increments from leaching oxide ores, weak mine supply is a foregone conclusion. Due to the combined effects of mine cuts, concentrate shortages, negative smelting margins, and sulfur resource constraints, global primary refined copper output growth in 2026 has fallen to multi-year lows, representing the most critical supply-side constraint for the year. Looking into Q4, mine disruptions have yet to fully subside, low TCs are unlikely to change, and high sulfuric acid prices are expected to persist. The tight refined copper supply picture will continue, with limited potential for significant output increases.
Global Refined Copper Demand Analysis
In 2026, total global copper consumption across six emerging sectors (solar, wind, automotive, charging infrastructure, energy storage, and computing power) is projected at 8.709 million tons, an increase of 511,000 tons from 2025. China's share accounts for 4.07 million tons, growing by only 39,000 tons, while overseas additions account for 472,000 tons. The center of gravity for demand growth is clearly shifting abroad.
A historic structural shift is underway: domestic solar demand is shrinking significantly, contributing less to overall growth, and automotive sector growth is slowing noticeably. Computing power and energy storage have become the core pillars of copper demand growth in 2026, offsetting declining increments from the solar, wind, and automotive sectors while supporting continued positive growth in emerging sector copper consumption.
Solar Power: Domestic Installations Peak and Decline, Global Increments Turn Negative, Becoming the Largest Drag
Global solar photovoltaic copper demand is expected to reach 2.193 million tons in 2026, a decrease of 242,000 tons year-on-year, marking the only sector among the six emerging tracks to see a demand contraction, making it the biggest drag on overall emerging demand growth. Domestically, copper consumption for solar is set to drop sharply from 1.225 million tons in 2025 to 808,000 tons. This is fundamentally driven by the "overhang" effect from years of record-high installations creating a high base, compounded by industry overcapacity and pressured module prices, slowing the pace of new centralized and distributed installations. Additionally, aluminum-for-copper substitution is accelerating in direct current cabling and bus equipment, reducing copper intensity per installed unit and further compressing domestic solar copper demand.
Wind Power: Slight Demand Decline, Sector Resilience Significantly Better Than Solar
Global onshore and offshore wind copper demand is projected at 666,000 tons in 2026, a modest decline of 46,000 tons year-on-year, demonstrating considerable resilience. The pace of new domestic installations has slowed, leading to a moderate decline in home demand, while overseas installations continue to grow steadily, offsetting some of the domestic reduction. The ongoing trend toward larger offshore wind turbines increases copper intensity per megawatt, effectively cushioning the overall sectoral demand decline. This makes wind a stabilizing force within the new energy segment, with a far smaller contraction than the solar sector.
Automotive: Growth Drops Sharply, Increment Nearly Halved
Global copper demand growth from the automotive sector has decelerated significantly in 2026, with full-year consumption expected to reach 3.308 million tons, adding just 148,000 tons annually, indicating a weakening of sectoral growth momentum. Demand for traditional fuel vehicles remains persistently weak, compounded by geopolitical trade barriers and elevated automaker inventories, leading to continued contraction in conventional vehicle copper use. Subsidy policies for new energy vehicles have been fully phased down, transitioning the industry from rapid penetration to a phase of high-quality, steady growth. With domestic NEV penetration surpassing 50%, the sector's natural growth rate continues to decline. While iterations like 800V high-voltage platforms and high-power motors modestly increase copper intensity per vehicle, this marginal improvement is insufficient to offset overall sectoral growth deceleration, failing to return automotive copper demand to high-growth territory.
Charging Infrastructure: Steady Modest Growth, Limited Contribution
Global copper demand for charging infrastructure continues its steady growth trend in 2026, reaching 186,000 tons, adding 28,000 tons year-on-year. The ongoing global build-out of new energy vehicle supporting infrastructure, with accelerated deployment in Europe, the US, and Southeast Asia, supports steady expansion in copper usage for this track. However, given the sector's relatively small overall scale, the increment from charging infrastructure is limited, unable to offset the negative contributions from solar and automotive sectors, resulting in a relatively modest boost to overall emerging copper demand.
Energy Storage: Sustained High Growth, Second Largest Source of Increments
The global energy storage sector maintains robust growth in 2026, with copper demand expected to reach 421,000 tons, adding 121,000 tons year-on-year, continuing the high-prosperity trend seen from 2022 to 2025. Policies supporting energy storage installations alongside renewable projects continue to roll out globally, with mandatory storage for wind and solar, standalone storage, and residential storage all experiencing explosive demand growth. Copper-intensive components such as storage station cables, converters, and bus equipment mean the sector maintains high growth rates. Against the backdrop of weakening traditional wind, solar, and automotive sectors, energy storage has become the second most important incremental track after computing power, providing stable support for global emerging sector copper demand.
Computing Power: The Largest Source of Copper Demand Growth in 2026, A Core Market Theme
In 2026, the computing power sector emerges as the absolute core support for global copper demand, with full-year copper consumption projected at 1.935 million tons, adding 502,000 tons year-on-year. This single sector's increment far exceeds the combined increase from all other five emerging tracks and fully covers the 288,000-ton decline from the solar and wind sectors combined. The generative AI industry continues to explode, with major computing clusters in China, Europe, and the US expanding rapidly. AI servers, high-voltage power distribution busbars, high-speed connectors, and liquid cooling systems consume over three times more copper per unit than traditional servers. Additionally, ancillary copper demand from grid expansion and transformer upgrades supporting computation infrastructure adds further growth. With an 18-month iteration cycle for computing hardware, sectoral copper demand shows extreme rigidity. Against the backdrop of waning traditional new energy sector growth, computing infrastructure has become the core logic underpinning global copper demand and counterbalancing structural weakness in other sectors during 2026.
Traditional Industries Under Pressure, Subsidy Effects Fade
In 2026, domestic Chinese copper demand from traditional end-use sectors shows marked structural divergence. Real estate and home appliances, the two core consumption sectors, continue to face pressure as policy stimulus effects fade, resulting in weak overall demand recovery. Grid investment stands out as maintaining a steady stabilizing trend, serving as one of the few positive support pillars within traditional sectors. Overall, copper consumption growth in traditional industries continues its weak trajectory, dragging on domestic demand, though the marginal downward pressure has somewhat eased.
Real Estate Completion Pressure Drags on Copper Consumption
China's real estate sector continues its weak operational trend in 2026, with starts, construction, and completions all falling year-on-year. Copper demand from property-related chains (home appliances, wiring, plumbing) remains persistently pressured, making this the largest drag on domestic copper consumption. Data from January to August 2026 confirms the industry's fundamentals have not yet seen a substantive reversal. Cumulative floor space under construction reached 5.61 billion square meters, down 12.8% year-on-year. New construction starts totaled 299 million square meters, down 24.9%. Developer willingness to acquire land and initiate projects remains at low levels, providing no support for future property-chain copper demand. Completed floor space reached 210 million square meters, down 23.8%, with the completion-side recovery underperforming expectations, directly impeding release of downstream copper demand in home renovation wiring and sanitary piping. Despite the recent valuation recovery in real estate stocks on policy optimism, the pace of physical completion recovery remains slow, and the weak copper consumption trend across the property chain is expected to persist.
Trade-In Policy Effects Diminish, Overseas Plant Construction Replaces Exports
China's home appliance sector in 2026 exhibits a structural pattern of recovering external demand, weak domestic demand, policy retreat, and marginal improvement. The overseas trade environment has improved temporarily, coupled with expanding demand in emerging markets, underscoring export resilience. However, weakened domestic trade-in subsidies, compounded by a high base effect, continue to suppress internal demand. The sector as a whole still drags on copper consumption, though marginal relief is expected in H2.
On the external front, trade frictions between China and the US in home appliances have seen a phase of détente in 2026, with multiple tariff reviews concluded and Section 337 investigations finalized. Some high tariff rates have lapsed and patent probes terminated, leading to a steady return of previously suppressed appliance export orders to the US. Concurrently, extreme European heatwaves have spiked demand for cooling appliances, while emerging markets in Southeast Asia and Latin America continue expanding consumption, further supporting exports. Data from General Administration of Customs and the China Household Electrical Appliances Association show H1 2026 appliance exports of USD 61.3 billion, up 3.4% year-on-year. The North American market returned to positive growth in May after a period of decline, with strong export growth in heat pumps and air conditioners, validating the logic of tariff easing and order recovery. Long-term, the trend of domestic appliance manufacturers establishing overseas plants to replace direct exports, aiming to circumvent cross-border trade barriers and better access foreign markets, continues to strengthen. While this mitigates trade friction risk to some extent, it also gradually diverts domestic manufacturing capacity and associated copper demand.
On the domestic front, the intensity of appliance policy stimulus in 2026 has weakened considerably, leaving the sector with insufficient momentum for recovery. The scope of trade-in subsidies has been sharply curtailed to just six product categories — air conditioners, refrigerators, washing machines, televisions, computers, and water heaters — and only for top-tier energy efficiency models. Higher thresholds and reduced coverage make the policy pull significantly weaker than in 2025, compounded by a high base from policy-driven sales last year. Consumer data confirms the weak domestic demand picture. AVC monitoring data shows H1 2026 appliance retail sales across all channels totaled RMB 425 billion, down 9.9% year-on-year. National Bureau of Statistics data for January-July shows total retail sales of household appliances and audio-video equipment at RMB 637.2 billion, down 6.6% year-on-year, with the decline narrowing slightly compared to H1 but overall recovery remaining tepid. As the high base effect wanes and overseas channel restocking demand is released, appliance production and sales growth is expected to gradually turn positive, and the segment's drag on domestic copper consumption will continue to narrow.
Grid Investment Maintains Resilience with Slowing Momentum
Grid and power investment, as key pillars of domestic growth stabilization, continue to show structural divergence in 2026. Grid investment maintains positive growth, providing core support for copper demand in traditional sectors, while power source investment declined year-on-year, with overall growth momentum weakening. Data shows grid infrastructure investment from January to July 2026 reached RMB 334 billion, up 0.75% year-on-year, sustaining positive growth despite widespread weakness in traditional demand sectors like property and appliances, thereby supporting copper demand from cables, transformers, and distribution equipment. Correspondingly, power source infrastructure investment from January to July totaled RMB 423.7 billion, down 4.72% year-on-year, with slowing project starts and progress, offsetting some of the demand increments from grid investment.
Supply-Demand Balance and Conclusions
The 2026 global refined copper market is characterized by sharply decelerated supply growth, structurally diversified demand, and continuously converging surplus, with the US Section 232 copper tariff policy acting as a key variable for Q4 and 2027. Overall, mine capacity bottlenecks suppress supply increments, traditional end-demand remains weak, and emerging computing and storage sectors underpin the demand floor. The scissors gap between supply and demand growth rates continues to narrow, with market surplus shrinking annually. Tariff policy pricing in the short term is cautious, though long-term risks from trade flow restructuring and cost escalation persist. This forecast incorporates 2027 market projections for the first time, providing a complete five-year market outlook.
On the supply side, mine bottlenecks are fully evident in 2026, with supply growth hitting a five-year low. Global copper raw material supply enters a low-growth cycle, with concentrate increments sharply reduced, representing the core bottleneck constraining refined copper output. Average annual copper concentrate increments were maintained at 450,000 to 680,000 tons during 2023–2024, before falling to 243,000 tons in 2025 and further down to 135,000 tons in 2026, a year-on-year growth rate of only 0.58% — the lowest in five years. In 2027, as some new mine capacity comes online, concentrate increments may recover to 420,000 tons, with growth rates ticking up slightly, but still remaining in a weak growth pattern. This low-growth mine scenario arises from a combination of long-cycle capacity bottlenecks and short-term disruptions. Key constraints include: aging high-grade deposits with declining ore grades, a 7–10 year development cycle for new mines, insufficient historical capex leading to delayed new capacity, and persistent operational instability in major producing regions. Chile and Peru consistently face water scarcity, labor strikes, and stringent environmental permitting, while African mines frequently suffer from power shortages and geological incidents.
This mine shortage transmits directly to the smelting sector. Spot TC remains persistently low or negative throughout 2026, significantly raising raw material costs for smelters. Primary refined copper output growth approaches a standstill, with full-year primary copper increasing by just 52,000 tons year-on-year. Industry capacity growth relies mainly on recycled copper, with secondary copper production up 265,000 tons year-on-year, partially offsetting primary copper reductions but unable to change the overall weak supply picture. Refined copper output growth for the year is only 1.11%, highlighting significant supply-side constraints.
On the demand side, global refined copper consumption continues to grow but at a significantly decelerated pace, with structural divergence becoming extreme. Full-year global refined copper consumption is expected to reach 28.73 million tons, growing 1.90% year-on-year, cooling meaningfully from the 2.8% to 3.0% average annual growth of 2023–2025. The core driver is the structural shift from weakening traditional demand to emerging demand underpinning growth. Traditional end-demand remains the largest drag on consumption growth. Domestic real estate completions and starts continue deep negative growth, with property-chain demand for wiring, sanitary tubes, and home renovation copper slow to recover. Home appliance trade-in policy retreat and weak domestic demand contribute to persistent weakness in traditional copper demand. Overseas, declining manufacturing activity in Europe and the US leads to modest declines in general industrial and traditional cable copper demand, with global traditional sector copper consumption increments continuously shrinking.
Emerging industries serve as the core support for the demand floor, preventing overall consumption from turning negative. Although the previously high-growth sectors of solar, wind, and new energy vehicles are decelerating from rapid expansion to steady growth, rigid demand sectors like computing infrastructure, energy storage, and grid upgrades continue robust growth. The explosion of AI data center construction rigidly expands copper demand from data center power distribution, busbars, high-speed connectors, and liquid cooling equipment. Mandatory storage for wind/solar, standalone storage projects scaling up, continue lifting storage-related copper demand, fully offsetting the decline in solar, wind, and automotive sectors, underpinning positive global copper consumption growth.
On supply-demand balance, the 2026 global copper market sees marginal improvement with the growth scissors gap converging. Mine supply growth of only 0.58% is significantly below refined copper demand growth of 1.90%. This combination of weak supply and relatively stronger demand directly drives a substantial reduction in market surplus. The 2025 global surplus of 469,000 tons falls to 250,000 tons in 2026, significantly easing market looseness. In 2027, with slight mine capacity recovery and steady consumption growth, the surplus edges up to 395,000 tons, maintaining a mild surplus without large inventory build-up pressure.
On the policy front, the US Section 232 copper tariff represents the core potential policy variable for the global copper market in 2026–2027. Multiple rounds of detail revisions and exemption arrangements only reduce the impact of an initial one-time shock; they do not eliminate the policy's long-term disruptive potential. Current market pricing for the probability and transmission paths of refined copper tariffs deviates from potential outcomes. If the plan materializes, it will significantly reshape global copper flows and cross-regional spreads. According to announcements from the White House and Department of Commerce, the US initiated the Section 232 copper investigation in 2025, first imposing a 50% tariff on copper semi-fabricated products, while specifying a proposed 15% import tariff on refined copper effective 2027, rising to 30% in 2028. In April and June 2026, the US revised tariff details twice, optimizing calculation rules, expanding exemption scopes, and adjusting differential rates, leading to a more gradual implementation trajectory. The core Q4 variable is the final resolution on Section 232 refined copper tariffs. Current market pricing for "strict enforcement" is already substantial (COMEX inventories at record levels, wide COMEX-LME spreads). The following scenario analysis presents subjective weightings: strict implementation (structural bullish), indefinite postponement (high-level range-bound), and abandonment (structural bearish). These probabilities represent research assumptions for scenario analysis, not actual event probabilities.
In summary, the 2026 global refined copper market presents a pattern of strengthened supply constraints, optimized demand structure, converging surplus, and brewing policy disturbances. Long-cycle mine capacity bottlenecks combined with short-term regional disruptions lock in low full-year supply growth; on the demand side, the shift between old and new growth drivers sees traditional industry drags slowing, while computing and energy storage tracks provide continuous underwriting, supporting steady total consumption growth. Supply-demand mismatches continue to ease market looseness, with solid support under copper prices. The unfolding US Section 232 copper tariff policy becomes the core market variable for Q4 and 2027, potentially impacting copper prices. Copper prices are expected to show a range-bound bullish trend in Q4. Key tracking points include the materialization of mine disruptions, progress in emerging demand delivery, and the pace of US tariff policy implementation.
Risk Warnings
Key risks include: major mine restarts underperforming expectations leading to further concentrate shortages; AI computing capex, solar/new energy vehicle demand falling short; domestic property and appliance recovery disappointing; recycled copper supply exceeding expectations; uncertainties in US tariff policy implementation; unexpected changes in Fed monetary policy or Middle East geopolitical conflict; and potential deviations in forecast assumptions relative to actual outcomes.
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