Goldman Sachs Warns on Copper Risks, Cuts Price Forecast

Chile's Antofagasta has reportedly proposed using spot-market index pricing for copper concentrate contracts with Chinese smelters covering the second half of 2026 and the first half of 2027, moving away from the traditional fixed TC/RC benchmark system. Since the 1980s, annual treatment and refining charges (TC/RCs) have served as the industry's benchmark pricing mechanism for copper concentrate contracts. However, tightening concentrate supply, rapid smelter capacity growth and record-low spot TC/RC levels have increasingly challenged the traditional framework. Spot TC/RC assessments have recently fallen to a record low of around -US$147.3 per tonne. A broader shift toward index-linked pricing could significantly reshape future copper concentrate contract negotiations and pricing mechanisms.

BHP is reportedly advancing plans to sell approximately US$1.5 billion worth of power transmission assets in Chile, including around 1,000 km of transmission lines supplying electricity to its Escondida, Spence and Cerro Colorado copper operations. According to media reports, the transaction could be completed as early as this year, although the final structure and potential buyers are still under review. The move as part of BHP’s broader strategy to streamline its portfolio and focus on core commodities such as copper. The company has continued to expand its copper exposure through projects including the Vicuña copper district development in Argentina, driven by growing demand linked to electrification and the energy transition.

The London Metal Exchange (LME) announced new requirements for the registration of Russian-origin copper and cobalt in EU-based LME warehouses as part of measures to comply with the European Union's latest sanctions package against Russia. Under the updated rules, Russian-origin copper and cobalt can only be registered in EU-listed warehouses if evidence is provided showing the material was imported into the EU before July 25, 2026. The measure follows the EU's 20th sanctions package, which includes restrictions on imports of Russian copper and other metal products. The LME noted that no Russian-origin copper or cobalt has been warranted in EU-based LME warehouses for more than a year and therefore expects limited market impact from the new requirements.