Between supply shortages and demand from AI and renewables, prices soar above $10,000. For the EU industry, margins are under pressure and new inflationary winds are blowing.
Copper is once again setting the pace for commodity markets. At the London Metal Exchange, prices for the red metal exceeded the psychological threshold of $10,000 per tonne at the end of October, reaching new all-time highs. This rally reflects an increasingly fragile balance between limited supply and demand driven by the energy transition and the data centre revolution.
‘Copper prices on the LME hit a record high on 29 October 2025,’ Bloomberg reported, citing ‘mine-supply setbacks’ — disruptions in mining and mineral flows — as the main cause of the surge.
Chilean and Indonesian mines, which together account for almost a third of global production, are reporting lower-than-expected output. The Wall Street Journal noted that ‘analysts have raised their copper price estimates for next year after a series of mining disruptions,’ while several operators have rushed to hedge through forward contracts to protect margins.
On the other side of the market, demand continues to surge. The Financial Times points out that ‘demand growth is being driven by data centres and the electrical infrastructure needed to support the new digital economy.’ The International Energy Agency (IEA) also confirms that ‘the expansion of electricity grids alone has driven much of the growth in copper demand over the past two years’ and forecasts double-digit growth in demand through 2030.
Effects on European industry
The copper rally now risks affecting the real economy, particularly European manufacturing. From cable and electrical equipment manufacturers to the automotive industry, rising raw material costs threaten to erode margins. More structured companies — with price hedges or indexed contracts — are relatively protected, but for SMEs more exposed to spot prices, the fourth quarter could prove challenging.
For utilities and network companies engaged in major investment plans in renewables and distribution, the impact of higher prices is tangible in the investments that a company makes to purchase, build or modernise durable goods: plants, networks, infrastructure, machinery, factories and power stations, often mitigated by tariff adjustment mechanisms. However, overall, the risk of inflated project costs is now structural.
On a macroeconomic level, high copper prices could also have an impact on industrial goods inflation, adding a variable of uncertainty for the ECB, which was hoping for a more linear disinflationary trajectory. This is an indirect but not negligible effect, especially if prices were to consolidate at record levels.
Market scenarios
According to Reuters, Goldman Sachs estimates a range of $10,000–11,000 per tonne for the two-year period 2026–2027, signalling a “structurally tight” market but one that is set to stabilise at a new equilibrium. In the short term, however, volatility remains high and speculative positions on the LME remain at two-year highs.
As Bloomberg summarises, ‘copper has become the nervous metal of the energy transition’: indispensable, scarce and, for now, increasingly expensive.
For investors, the international mining sector (Glencore, Antofagasta, Freeport-McMoRan) remains among the main beneficiaries, while for the European components and processing sector, the picture is more nuanced: those with pricing power are holding up, while those without risk seeing their profitability squeezed.
Overall, copper is once again becoming a litmus test for the global industrial cycle — and, as is often the case, an early indicator of the real economy.