Copper prices have skyrocketed over the past year, jumping from roughly $8,700 per tonne to an all-time high above $13,000. This represents a staggering 52% increase, driven by a perfect storm of supply shocks, financial speculation, and forward-buying ahead of potential U.S. trade policy changes. Bernstein analyst Bob Brackett identifies three key factors behind the rally.

First, major supply disruptions at critical mines like Kamoa-Kakula and Grasberg have tightened physical availability. Second, financial investors have piled into the market, with net futures positioning reaching elevated levels. The most significant driver, however, is preemptive stockpiling by U.S. traders anticipating tariffs.

In anticipation of a potential 15% tariff on refined copper starting in 2027, Comex inventories have ballooned by 300,000 tonnes since April 2025. This has created a massive price premium for U.S.-bound copper compared to global benchmarks, incentivizing a rush of imports. Brackett argues these proposed tariffs are economically flawed given America's reliance on imports from Chile, Canada, and Peru, suggesting a trade deal is a more likely outcome.