BHP CEO: Copper Supply Tightness Hard to Resolve, High-Price Era May Last for Years

(December 18) - In 2025, constrained copper supply has driven prices to surge and triggered stockpiling. The CEO of one of the world's largest mining companies stated that high copper prices are unlikely to pull back in the short term.

Driven by tightening supply, mining disruptions, and concerns over US tariffs, London copper futures hit a record high of $11,952 per mt last Friday; New York copper prices have accumulated an increase of approximately 34% year-to-date, poised to record the best performance since 2009.

On Wednesday (December 17), BHP CEO Mike Henry emphasized in an interview that copper is a "crucial" metal, not only supporting the daily economy but also being a key component in decarbonization and digital technologies.

Henry said, "The annual market size for copper is approximately between $300 billion and $400 billion; in contrast, the annual market size for rare earths, often discussed, is only about $20 billion. So this is a very large market."

Like rare earth minerals, copper is facing pressure from surging demand and lagging supply. Henry pointed out that against the backdrop of "strong demand growth," the copper bull market may persist for several years.

"We expect copper demand to grow 70% from now to 2050, but supply is becoming increasingly difficult to release. New mines are fewer, often relatively small, lower grade, and located in harsher regions, making rapid development challenging."

BHP is one of the world's largest copper producers. Henry noted that over the past year, the copper market has rapidly shifted from a slight surplus to supply bottlenecks. He indicated that 12 to 18 months ago, market observers had expected 2025 to be "somewhat soft" for copper.

"Just a few disruptions at global copper mines can quickly push the market into deficit, driving prices to new highs," he said. "We expect this supply tightness to only intensify from now to the end of 2030."

When asked about the price outlook, Henry emphasized that predicting price movements is very difficult, but he also made clear that the issue of supply deficits will not be resolved in the short term. "I can say with considerable confidence that the market is very tight right now, and with just a little disturbance, prices could continue to rise," he added, noting that other metals, including gold and silver, have also hit record highs this year.

Henry also stated that increased market focus on the "overall basket of commodities" could provide support for copper prices.

In a late November report, UBS indicated that copper is showing signs of a "structural bull market," noting that "copper (along with aluminum) remains our top pick among industrial metals and is a key driver behind our upgrade of the commodities sector from 'neutral' to 'attractive'."

UBS forecasts that copper prices will reach $12,000 per metric ton by the end of the first quarter of 2026 and rise to $13,000 by the end of next year.

Please note that this news is sourced from https://www.cls.cn/detail/2233775 and translated by SMM.