Goldman Sees Copper Peaking in August as Supply Tightens Globally

Copper prices surged this week following a revised forecast from Goldman Sachs, which now sees the metal hitting a peak of $10,050 per tonne in August before easing modestly into year-end. The bank attributes the move to tightening inventories outside the United States, firm demand from China, and the looming impact of US trade tariffs on metal imports.

This marks a shift in narrative from earlier in the year, when base metals faced downward pressure from global growth concerns. Traders are now positioning for a seasonal high, as the combination of structural supply strain and near-term policy moves shifts the balance in favor of higher copper prices through the third quarter.

Tariff Anxiety Fuels Regional Supply Crunch

At the core of the price spike is a growing bifurcation in copper flows. US import volumes have surged in recent months ahead of expected Section 232 tariffs, while inventories in Europe and Asia have declined sharply. Copper held outside of the US is now at its lowest level in over five years, driving backwardation in LME contracts and widening the Comex premium.

The situation has created an unusual dynamic: US traders are aggressively front-loading purchases, while ex-US markets face acute scarcity. This imbalance is feeding through into price action across spot and futures markets, with traders increasingly focusing on delivery premiums and arbitrage plays between regional exchanges.

China’s Demand Remains Solid

Despite headwinds in China’s property sector, copper demand from the world’s largest consumer has proven more resilient than expected. Infrastructure spending, grid modernization, and battery manufacturing are all supporting consumption. Industrial production data has remained steady, and smelters have kept operating rates high through the first half of the year.

This demand consistency has helped prevent any meaningful correction in prices, even as speculative flows accelerated. For traders, the message is clear: until China softens materially or US policy shifts, the floor under copper appears firm.

Mine Supply Still Constrained

Structural limitations on the supply side continue to reinforce the bullish backdrop. Key producers in Chile and Peru face declining ore grades, environmental permitting delays, and logistical disruptions. Water availability, especially in high-altitude projects, has also impacted output. New project pipelines remain slow, and no major relief is expected in the near term.

This long-running issue remains central to copper’s upside risk. With no significant production growth expected before 2026, any increase in demand or policy-driven disruption could accelerate price gains beyond Goldman’s current forecast.

Post-August Outlook: Moderation, Not Collapse

While the August target of $10,050 reflects a near-term squeeze, Goldman sees prices drifting lower into Q4 as tariffs are implemented and US stockpiling slows. The bank expects copper to settle closer to $9,700 per tonne by December, barring any unexpected macro shock.

Still, traders should remain alert to timing risks. Delays in policy implementation or a sudden rebound in Chinese industrial activity could extend the rally or create new upside pressure. Conversely, a broader slowdown or unexpected easing in geopolitical tensions could bring forward the expected correction.

Tips for Traders

• Copper (LME) could rally toward $10,050 by August amid supply dislocations and US import pressure.

• Comex–LME spreads may continue to widen; consider arbitrage trades or exposure to regional premiums.

• Freeport-McMoRan (NYSE: FCX) and similar copper-linked equities may benefit from strong price action—watch for peak timing signals.

• AUD/USD and CAD/USD could strengthen in tandem with copper momentum, supported by commodity exposure.

• Gold remains an attractive hedge if commodity-led inflation expectations begin to build againץ