Copper and Base Metals: LME Daily — 2026-10-15
Copper prices remain elevated near record highs, driven by severe supply disruptions in Chile, including a strike at Centinela and a looming walkout at Escondida. While Chinese demand signals strengthen post-holiday, US tariff uncertainty and a recent hot CPI print have introduced volatility into the broader base metals complex.
Copper and Base Metals: LME Daily — 2026-10-15
Top developments
Chilean Supply Crisis Escalates with Escondida Strike Threat
The supply-side narrative has intensified this week as supervisors at Escondida, the world's largest copper mine operated by BHP, voted to strike following failed mediation talks. This follows the commencement of an indefinite strike at Codelco’s Centinela mine on October 8, involving 709 workers.
US Tariff "Collapse" Scenario and COMEX Premium Dynamics
Macquarie analysts have lifted 2026 copper price forecasts but highlighted a "collapse" scenario if Washington rules out tariffs, though they deem this least likely. The more probable outcome is regulatory limbo past January 1, keeping 1.5 million tonnes of copper stranded in US warehouses. This uncertainty continues to distort the price gap between COMEX and LME, with the tariff trade potentially fading as the deadline approaches.
Chinese Demand Rebound Post-Holiday
Copper prices climbed to two-week peaks earlier in the week as Chinese buyers returned from the National Day holiday, signaling renewed restocking activity. Benchmark three-month copper on the LME hit $14,541/tonne on October 9, supported by these demand signals and tight visible inventories outside the US.
Macro Headwinds: Hot US CPI Pressures Aluminium and Zinc
In contrast to copper’s supply-driven strength, aluminium and zinc faced downward pressure following a hotter-than-expected US September CPI report released on October 13. LME aluminium dropped to an eight-month low before rebounding slightly, while zinc fell amid fears that persistent inflation will keep the Federal Reserve hawkish, strengthening the dollar and weighing on industrial metals.
Local view
Local-language media in Chile are expressing deep concern over the compounding crises at major mines. BioBioChile reports that the strike at Centinela, coupled with a new tragedy at El Teniente, is putting immense pressure on already high prices, describing the situation as "unprecedented" for the sector.
Context & numbers
- LME Copper Price: Reached $14,541/tonne on Oct 9; currently consolidating near $14,400-$14,500 range.
- Chile Output: National copper output fell 12.7% year-on-year in August to 366,300 tonnes, a 15-year low. Escondida specifically saw a 27.6% production drop.
- ICSG Forecast: Global refined copper market expected to swing to a 150,000-tonne deficit in 2026.
- Aurubis Premium: Set a record 2027 copper premium of $347/tonne, reflecting tight supply conditions in Europe.
- US Inventories: Approximately 1.5 million tonnes of copper are currently held in US warehouses due to tariff hedging.
On the radar
- Escondida Strike Start Date: The supervisor strike at Escondida is set to begin Wednesday (Oct 15), potentially escalating the supply crisis further.
- LME Week 2026: The industry gathers next week, with record-low Treatment Charges (TCs) and war-hit supply chains expected to dominate discussions.
- US Tariff Deadline: Watch for any official statements from Washington regarding Section 232 tariffs before the year-end, which could trigger a rapid unwind of US stockpiles.
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