Copper and Base Metals: LME Daily — 2026-09-19
Copper prices rebounded this week to near $14,500 per tonne as Chinese buyers returned to the market, offsetting pressure from a hawkish US Federal Reserve rate hike. Meanwhile, Chile reported its weakest copper output in 19 years, signaling the first global mine supply decline since 2017 and tightening physical balances for Q4.
Copper and Base Metals: LME Daily — 2026-09-19
Top developments
Chinese demand recovery drives weekly gain
Three-month copper on the London Metal Exchange (LME) rose 1.1% to $14,231 a metric ton on September 16, extending gains through the week to trade at $14,521 by September 18. This rally was driven by active physical buying in China, where lower prices earlier in the week encouraged restocking after a period of caution. The return of Chinese buyers helped offset macro headwinds from the US Federal Reserve’s recent quarter-point interest rate increase.
Chile posts weakest output in 19 years
Chile mined only 2.9 million tonnes of copper from January to July 2026, a 7.1% year-on-year decline and the lowest level since 2003. Chilean Finance Minister Jorge Quiroz attributed nearly one percentage point of lost GDP growth to this mining slump, citing aging deposits and operational challenges at major producers like Codelco and BHP. This supply shock supports LME copper prices by reducing available concentrate, even as smelter treatment charges fall below $20 due to oversupply in refining capacity relative to mine supply.
Global mine supply faces first annual decline since 2017
Global copper mine production is on track to contract in 2026 for the first time in nine years, according to recent market analysis. Despite record-high prices near $14,854 per tonne earlier in September, new projects cannot come online fast enough to replace declining grades in mature mines. This structural deficit is reinforced by ICSG forecasts predicting a 150,000-tonne global refined copper deficit for the year.
SHFE metals broadly higher on domestic strength
Shanghai Futures Exchange (SHFE) base metals closed mixed-to-higher on September 18, with SHFE copper rising 1.42% and SHFE zinc gaining 1.68%. The domestic rally mirrored international strength but was also supported by local inventory destocking and expectations of policy support for infrastructure. SHFE aluminum edged up 0.74%, while nickel slipped slightly by 0.55%, reflecting divergent industrial demand signals in China's manufacturing sector.
Local view
In Chile, state-owned miner Codelco has postponed its recovery plan until the end of 2026, revising investments and labor structures amid rising costs and falling production. Local media reports that Finance Minister Quiroz is under pressure as the "copper recession" challenges the government's fiscal targets, with the country needing a significant rebound in H2 to meet annual forecasts.
Context & numbers
- LME Copper: Closed the week around $14,521/tonne, up from lows near $14,200 earlier in the week.
- Other LME Metals: As of mid-September, Aluminium traded near $3,281.50/tonne, Zinc at $3,912.50/tonne, and Nickel at $16,160/tonne.
- Chile Production: Jan-July output down 7.1% YoY; Cochilco forecasts full-year production at 5.27 million tonnes, a 2.6% drop from 2025.
- Smelter TCs: Spot treatment charges have fallen below $20/tonne, indicating smelters are struggling to secure concentrate despite high copper prices.
On the radar
- US Tariff Policy: Investors remain cautious about potential changes to US copper tariffs, which have previously caused volatility between COMEX and LME premiums.
- Fed Rate Path: The recent quarter-point hike has strengthened the dollar, potentially capping upside for dollar-denominated commodities if hawkish messaging continues.
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