Chile's Cochilco Raises Copper Price Forecast Amid Improved Global Outlook

On May 28 (Wednesday), Chile's National Copper Commission (Cochilco) raised its average copper price forecasts for this year and next, citing improved global prospects following a temporary tariff agreement between China and the US.

The commission increased its average copper price forecasts for 2025 and 2026 to $4.30 per pound, up from the previous estimate of $4.25 per pound in its February report.

At a press conference, Cochilco's leadership expressed cautious optimism about the copper price outlook, while acknowledging that the global supply situation was tighter than expected and that demand fundamentals were strong.

Cochilco stated that the agreement reached between the US and China earlier this month to reduce hefty tariffs for at least 90 days "significantly reduced trade barriers and eased tensions that had affected confidence and global trade dynamics."

Cochilco also believes that long-term trends such as the energy transition, power grid expansion, EVs, and ESS will continue to support copper prices.

In Q1, production increased at the world's largest copper producers, Codelco and Antofagasta Minerals. Cochilco reported that state-owned Codelco's production grew by 5.2% in April.

Despite this, the increase in domestic production did not offset the global decline. Cochilco now expects global supply growth this year to be significantly lower than previously forecasted, at 1.3%, compared to the previous estimate of 4.7% growth.

Victor Garay, Cochilco's Mining Market Coordinator, stated that in a market that is effectively balanced, any supply disruptions would directly impact prices.

Additionally, Cochilco forecasts that Chile's copper production will increase by 3% this year and continue to rise by 3% in 2026, with an expected output of 5.84 million mt by then.

The production guidance is lower than Cochilco's February forecasts, which projected growth rates of 4.6% for 2025 and 3.6% for 2026.

Globally, Cochilco forecasts a copper supply deficit of 109,000 mt this year and a slight surplus of 19,000 mt in 2026, with demand expected to grow by 2.3% and 2.8% this year and next, respectively.